Tata Motors, Indraprastha Gas Ltd, and HFCL Grapple with Challenges

Technical Overview – Nifty 50

Nifty50 on 20th October again witnessed a gap-down opening for the second straight day taking the clues from the global markets. The prices after witnessing a gap down opening near 19,500 levels the prices traded in a very narrow but defended the 19,500 levels towards the close. 

The Nifty50 from the last three weeks is trading within the very narrow range of 300 points between 19,800 – 19,500 levels and has formed a smaller degree rectangle pattern on the daily scale. After forming two consecutive bullish weekly closings the index closed 1 percent lower and formed a tiny spinning top pattern.

The prices on the daily chart are trading below their 9, 21, and 50 EMA and are acting as a strong resistance to the index. The positive context includes index trading above its 100 EMA which is placed at 19,300 levels. The prices are expected to trade within the range of 19,800 – 19,400 levels and a break on either side will decide the trend for the Nifty.

Technical Overview – Bank Nifty

The Bank Nifty on 20 October, witnessed a gap down opening near 43,600 levels and registered an intraday low at 43,567 in the initial minutes of the trade. The prices witnessed a smart recovery from the lower levels and traded in an extremely narrow range throughout the day.

On the broader time frame, the Banking index closed more than 1 percent lower and formed a red candle and more importantly closed below its 21 EMA which is placed at 44,220 levels.

The Bank Nifty on the daily chart has been trading in a rectangle pattern for the last couple of months and is trading within the range of almost 2000 points. From the last couple of trading sessions, the prices are trading near the lower band of the pattern and are trading near the make-or-break level.

Immediate support is placed at 43,450 levels in case prices breach and sustain below the same bearish breakdown will be initiated in the index towards 42,800 – 42,500 levels. The upper band is capped below 44,100 levels near its 9 DEMA.

Indian markets:

• Domestic stock market faced third consecutive day of decline on Friday. Negative global cues influenced the market’s volatility. Prices of oil increased significantly, impacting market sentiment.
• Increase in U.S. bonds yields added to market pressure.
• Tensions in the Middle East region contributed to market uncertainty.
• Hints of further interest rate hikes by the U.S. Federal Reserve affected investor confidence.
• Nifty settled below the 19,550 mark. It was the only sectoral index on the NSE that didn’t decline. All other sectoral indices on the NSE ended in the red.
• Stocks in the oil & gas sector experienced significant selling pressure. Stocks in the consumer durables sector also witnessed major selling.

Global Markets

• Markets in Europe and Asia declined on Friday. The Peoples Bank of China kept its one-year loan prime rate unchanged at 3.45%. The five-year benchmark loan rate was held at 4.2%.
• US stocks ended lower on Thursday as Powells comments and rising bond yields weighed on markets. U.S. Federal Reserve Chair Jerome Powell said inflation was still too high and would likely require lower economic growth. Powell also added that monetary policy was not yet too tight.
• The benchmark 10-year Treasury yield is inching closer to the well-followed 5% mark that last crossed in 2007.

Stocks in Spotlight

• Tata Motors saw its early gains plateau despite finalizing a significant deal. The company signed a Rs 150-crore agreement to acquire a 26.79 percent stake in the digital platform Freight Tiger. Tata Motors formalized this deal through a securities subscription agreement and a shareholders agreement with Freight Commerce Solutions. Notably, the agreement allows Tata Motors the option to invest an additional Rs 100 crore over the next two years at the prevailing market value, as stated in a regulatory filing.
• Indraprastha Gas Ltd (IGL) faced a significant setback, witnessing a decline of over 10 percent in its stock value. This decline followed the approval of the electric vehicle policy for cab aggregators and delivery services by the Delhi government. Consequently, mutual funds and insurance companies holding IGL shares collectively experienced a loss exceeding Rs 681 crore in value.
• HFCL witnessed a 4 percent decline in early trade following the release of disappointing earnings for the July-September quarter. The telecom equipment manufacturer reported a significant 15.2 percent decline in its net profit, dropping from Rs 82 crore to Rs 69 crore in Q2 compared to the previous fiscal year. Additionally, the company’s topline also took a hit, decreasing by 5.3 percent year-on-year to Rs 1,111.50 crore in the September quarter. This downturn in financial performance led to the decline in HFCL’s stock value in the early trading hours.

News from the IPO world🌐

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