Benchmarks end almost flat, Nifty ends below 21,550

Domestic markets concluded the day on a neutral note. The Nifty 50 index opened at 21,653.60 and reached a day`s high of 21,724.45 in afternoon trade. Despite this, profit selling at higher levels led to the index settling below the 21,550 mark by the end of the session. Realty and auto sectors bolstered market breadth, while banks and media stocks experienced selling pressure. The market saw a reversal of gains due to increased profit-booking, signaling concerns over high valuations. Traders anticipate potential volatility leading up to the elections, with the possibility of further decline if the Nifty breaches 21,500. However, a healthy market consolidation is projected within the 21,800-21,300 range during the Q3 earnings season, suggesting a potential for a subsequent rally.

The barometer index, the S&P BSE Sensex rose 30.99 points or 0.04% to 71,386.21. The Nifty 50 index gained 31.85 points or 0.15% to 21,544.85.

Nestle India (down 1.03%), HDFC Bank (down 0.80%) and Reliance Industries (down 0.21%) were major drags.

In the broader market, the S&P BSE Mid-Cap index added 0.07% and the S&P BSE Small-Cap index advanced 0.37%.

The market breadth was positive. On the BSE, 2241 shares rose and 1606 shares fell. A total of 97 shares were unchanged.

The NSE`s India VIX, a gauge of market`s expectation of volatility over the near term, declined 1.48% to 13.26.

Numbers to Track:

The yield on India`s 10-year benchmark federal paper shed 0.12% to 7.194 as compared with previous close 7.203.

In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 83.1250, compared with 83.1400 its close of during the previous trading session.

MCX Gold futures for 5 February 2024 settlement rose 0.51% to Rs 62,411.

The US Dollar index (DXY), which tracks the greenback`s value against a basket of currencies, was up 0.09% to 102.30.

The United States 10-year bond yield advanced 0.91% to 4.037.

In the commodities market, Brent crude for March 2024 settlement slipped $1.50 or 1.97% to $77.62 a barrel.

Global Markets:

European stocks declined while Asian stocks ended mixed on Tuesday. Risk appetite was subdued as investors awaited key inflation data releases from the U.S., Japan, and China.

Expectations of early interest rate cuts by the U.S. Federal Reserve, the European Central Bank, and the Bank of England were tempered. This shift in outlook was influenced by a surprising increase in U.S. nonfarm payrolls and a rise in eurozone inflation to 2.9% in December from 2.4% in November, supporting the case for the European Central Bank to maintain record high interest rates.

U.S. stocks ended higher on Monday boosted by tech shares. Global investors will be looking ahead to US inflation data and big bank earnings in the week ahead for further clues on the state of the economy and the path of rate cuts from the Federal Reserve.

Stocks in Spotlight:

IRB Infrastructure Developers surged 9.18% after the company�s toll collection jumped 25.77% to Rs 488 crore in December 2023 from Rs 388 crore in December 2022.

Caplin Point Laboratories rose 3.87% after the company announced strategic investment of Rs 700 crore in Tamil Nadu.

Zee Entertainment Enterprises dropped 7.64% following reports suggesting that Sony is considering canceling the proposed $10 billion merger with the company.

However, ZEEL has refuted claims made in the media about Sony terminating the $10 billion merger and has reaffirmed its commitment to the tie-up.

Bajaj Auto gained 1.55% to Rs 7093.75 after the board of directors of the company has approved the proposal for buyback of up to 40,00,000 fully paid-up equity shares at a price of Rs 10,000 per equity share payable in cash for a total consideration not exceeding Rs 4,000 crore.

Tata Motors advanced 1.32% after the JLR reported wholesale volumes of 101,043 units (excluding the Chery Jaguar Land Rover China JV) for the third quarter of FY24 (three-month period to 31 December 2023), up 27% compared to the same quarter a year ago and up 4% compared to the quarter ended 30 September 2023. Meanwhile, Tata Motors Group global wholesales in Q3 FY24, including Jaguar Land Rover was at 338,177, rising 9% as compared to Q3 FY23.

Eicher Motors slipped 0.41%. The Royal Enfield, a unit of Eicher Motors signed a non-binding Memorandum of Understanding (MoU) with the Government of Tamil Nadu at Global Investors Meet 2024, at Chennai. Under the MoU, Eicher Motors proposed to invest around Rs. 3,000 crore over a period of eight years into the state to set up greenfield and brownfield projects in the region

JSW Steel shed 0.13%. The steel major said its consolidated crude steel production grew by 12% to 6.87 million tonnes in Q3 FY24 as against 6.14 million tonnes recorded in Q3 FY23. Sequentially, the company�s crude steel production rose 8% in Q3 FY24 from 6.34 million tonnes reported in Q2 FY24.

Aurobindo Pharma rose 0.47%. The U.S. Food and Drug Administration (FDA) had conducted an inspection at the Unit VI-B, a Formulation manufacturing facility of the company, situated at Chitkul Village, Telangana, from 22 to 29 September 2023. The Unit has now received Establishment Inspection Report classifying the facility as "Voluntary Action Indicated" (VAI).

Bajaj Finserv shed 0.88%. The firm announced that its subsidiary, Bajaj Allianz General Insurance Company`s gross direct premium underwritten for December 2023 was at Rs 1,425.10 crore, recording a growth of 17.85% year on year. Bajaj Allianz Life Insurance Company`s total premium aggregated to Rs 961.51 crore for the month of December 2023, up 3.52% as against Rs 928.79 crore recorded in the same period a year ago.

IPO Update:

The initial public offer (IPO) of Jyoti CNC Automation received bids for 4,40,01,675 shares as against 1,75,39,681 shares on offer, according to stock exchange data at 17:00 IST on Tuesday (9 January 2024). The issue was subscribed 2.51 times.

The issue opened for bidding on Tuesday (9 January 2024) and it will close on Thursday (11 Thursday 2024). The price band of the IPO is fixed at Rs 315-331 per share. An investor can bid for a minimum of 45 equity shares and in multiples thereof.

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