Today’s Market Summarised
The absolute slaughter of bulls in the market today. Each time Nifty tried to raise its head, got pushed down with more power. After opening with a huge gap-up at 13,954, Nifty quickly formed multiple red candles and started moving down. The index tried to take support at 13,800 but fell more.
Then at 2 pm, something interesting happened. With banks suddenly skyrocketing, it was as if Nifty had gained some new life. It rallied more than 150 points in 30 minutes. The index then in the next 40 minutes fell 280 points. Can you imagine such high volatility! If you can’t then check out the chart below! Nifty regained some losses and closed the day at 13,634, down 182 points or 1.32%
Bank Nifty was the one who again closed above yesterday’s level. After opening with a gap-up at 30,700, the index fell a bit but then consolidated around 30,500 level. The index was relatively calm, just like the sea is before a storm. After 2 pm, Bank Nifty shot up nearly 600+ points then came down and by the market close, it was back at the same level. But unlike Nifty, the index of banks still closed in the green. Bank Nifty closed the day at 30,565, up 207 points or 0.68%.
Bank Nifty closed in the green today, along with Nifty Realty on the expectation of a good budget announcement. Every other sector fell with Metal, IT and Auto sectors falling more than 2%.
Asian markets closed in the red today. European markets are also in the red.
News Picks
Shares of IndusInd Bank closed as the top-gainer in Nifty 50, ahead of Q3 results announcement today. The market is eyeing for a positive result from the private banker and good commentary from management. The stock had also taken good support and closed above Rs 800 yesterday. Check weekly and daily charts to understand the importance of the level.
Shares of SunPharma jumped more than 7% intraday after 2 pm. The company announced a net profit of Rs 1,852.48 crore, up more than 100%. Other incomes of the company aided the jump beating market expectations. We had talked how results of Pharma companies related to COVID-19 medicines may be good, while that of others may be bad. Is this part of that?
After ending COVID drug Avigan trials in Kuwait after poor results, and worse than expected Q3 results, Dr Reddy’s fell more than 5.52% today to become Nifty’s top loser. The company posted a Q3 consolidated net profit of Rs 19.8 crore as compared to losses last year but was still much below expectations. The stock has taken support at early August 2020 levels and can be watched for more movements.
Shares of Maruti continued to fall from yesterday, with all auto stocks generally coming under selling pressure. The company had announced a 24% YoY jump in net profits but a fall in margins.
Shares of Tata Steel fell more than 3.64% as the company’s talks for selling Dutch business to Swedish company SSAB failed. We had discussed this deal many weeks earlier, where Tata Steel was expected to reduce their debts with proceeds from the sale. Unfortunate. Weekly charts are not looking good with many temporary supports being broken. You can check out how perfect resistance at 730-740 region was taken before the stock started falling and now support at 595-600 is taken.
Havells India fell more than 11.6% today, as the stock rallied to fresh all-time highs in yesterday’s bear market. Today it was caught by the bears and pushed down. The stock had rallied 32% in a month.
Reliance showed signs of recovery by trading in green, but fell sharply after 2 pm.
Markets Ahead
Well, it was a tough day for traders with no stop losses. And it would have been an amazing day for traders who quickly understood the trend and booked profits without getting too greedy.
As I do believe, trading is a lot about the emotions of an individual. We have a good weekend ahead of us, with lots of time to study charts and prepare good trading setups for ourselves. Well, investors, you know what to do. Buy the dips and HOLD(as they say in WallStreetBets). But do remember to make sure that your portfolio only has gems, absolute gems of their industries in it. I know, some stocks will keep giving quick and good returns even when the market falls. But trust me on this, in the case of a larger correction to 13,500 or even lower, you want to be holding good shares of good companies.
But do remember that Monday will be the Union Budget Presentation. Markets will be volatile, maybe much more than today. Also, option buyers do remember that since a lot of people are hoping for big movements after the budget to both sides, there will be high premiums in the market at every strike which can work against you. So even if you see market moving in your direction, premiums might fall. Please keep that in mind.
That being said, have a chill and amazing weekend. I know some of us would be closing the week with red portfolios, but do remember the end goal is to take intelligent decisions that will help us protect our capital. Study well, and sleep well. Share this article if you felt it was helpful! And leave a comment down below about any of your thoughts.
Hope you will all tune in to The Stock Market Show tonight. Keep watching this space for more.