 "Market Today: ITC Q2, FII selling, Waaree, Deepak Builders IPO allotment")
Stock Market Today, October 24, 2024: Indian benchmark indices, Nifty50 and Sensex, may see a flat to positive start today. At 6:35 AM, GIFT Nifty Futures showed a slight uptick of 17 points, trading at 24,500, signalling a potentially positive opening for the markets.
Key market drivers for the day
Investors will closely monitor quarterly earnings reports alongside manufacturing, composite, and services Flash PMI data for October.
India cannot risk another bout of inflation and the monetary policy committee (MPC) must adopt a cautious approach to lowering interest rates, members of the rate-setting panel said in the minutes of the October meeting. READ MORE
Q2 earnings
More From This Section
Market participants will react to the Q2 results from companies like FMCG giant Hindustan Unilever and TVS Motor Company and SBI Life Insurance. Hindustan Unilever (HUL), one of the largest consumer companies in India, reported Q2 results that fell short of analysts' expectations. The management indicated that demand is expected to remain stable, despite witnessing moderating growth in urban areas and a gradual recovery in rural regions during Q2FY25. READ MORE
TVS Motor's consolidated net profit soared 45 per cent to Rs 560.49 crore in Q2FY25 due to the highest-ever overall quarterly two-wheeler and three-wheeler sales. READ MORE
Additionally, investors will watch out for earnings from big players such as ITC, NTPC, ACC, IndusInd Bank, Colgate-Palmolive, and Godrej Consumer Products, among several others.
ITC is set to release its Q2 results for FY25 today, with brokerages predicting a net profit increase of approximately 1.95 per cent, averaging around Rs 5,023.13 crore, compared to Rs 4,927 crore a year earlier. READ MORE
Asia-Pacific markets
Asia-Pacific markets were mixed following a drop in US stocks. South Korea narrowly avoided a technical recession, reporting a 0.1 per cent quarter-on-quarter GDP growth in Q3, which was below the expected 0.5 per cent.
Additionally, the au Jibun Bank Japan Manufacturing Flash PMI declined to 49 in October, as against a final 49.7 in the previous month, below market forecasts of 49.9, marking the fourth straight month of contraction in factory activity, preliminary estimates showed.
Consequently, Kospi was trading 0.17 per cent lower. Nikkei was up 0.4 per cent and ASX 200 also rose, up 0.1 per cent.
Wall Street
Wall Street closed lower on Wednesday, pressured by rising Treasury yields, with the Dow witnessing its largest single-day loss since early September, dropping over 400 points (0.96 per cent). The S&P 500 fell 0.92 per cent, and the Nasdaq Composite decreased 1.6 per cent, marking the third consecutive day of losses for both the Dow and S&P 500. That said, the 10-year Treasury yield surpassed 4.25 per cent.
Investors will also keep an eye on manufacturing and services Flash PMI for October, initial jobless claims for the week-ended October 19, and new home sales for September.
Regulatory update
The Securities and Exchange Board of India (Sebi) is considering a proposal to convert single stock options into futures contracts a day prior to expiration. This initiative, inspired by the commodities market model, aims to reduce risks associated with physical settlement and margin payments. READ MORE
Apart from that, Sebi chairperson Madhabi Puri Buch is scheduled to appear before the Public Accounts Committee (PAC) of Parliament today, according to reports. This meeting followed accusations from a Bharatiya Janata Party member, who claimed that the panel's chairman, Congress MP KC Venugopal, was guiding their actions based on political motivations.
Institutional activity
On October 23, foreign institutional investors (FIIs) continued their selling trend, offloading shares worth Rs 5,684.63 crore, while domestic institutional investors (DIIs) purchased shares worth Rs 6,039.90 crore.
IPO corner
Deepak Builders & Engineers India and Waaree Energies IPOs will see their allotment today. Deepak Builders & Engineers India IPO attracted bids for 37.24 crore equity shares—41.54 times the offer size of 89.67 lakh shares by the close of subscription on October 23. On the other hand, Waaree Energies Limited also saw an exceptional response, receiving a record 97.34 lakh applications for its public issue. This marked the highest number of applications ever recorded for any IPO at the upper end of the price band, amounting to a net public issue of Rs 4,321 crore.
That said, Godavari Biorefineries Limited IPO (Mainline) will enter its second day of subscription, while Usha Financial Services Limited IPO (SME) will open for subscription today.
Additionally, Freshara Agro Exports Limited IPO (SME) is set to list on the bourses today. Meanwhile, the IPOs for Danish Power Limited (SME), United Heat Transfer Limited (SME), and OBSC Perfection Limited (SME) will see their last day of subscription.
Commodity prices
Oil prices declined on Wednesday after US crude inventories rose more than anticipated, despite a rebound in refining activity. Brent crude futures fell $1.08 (1.42 per cent) to close at $74.96 a barrel, while US West Texas Intermediate crude futures dropped 97 cents (1.35 per cent) to settle at $70.77 a barrel.
On the other hand, gold prices saw a decline of over 1 per cent after reaching a record high on Wednesday, as a stronger dollar and rising US Treasury yields outweighed safe-haven demand. Spot gold was down 1 per cent to $2,721.12 per ounce, having earlier hit a high of $2,758.37, while US gold futures fell 0.9 per cent to $2,734.60.
Previous session highlights
On Wednesday, Indian equity indices ended the session in negative territory. The BSE Sensex dropped by 138.74 points (0.17 per cent) to close at 80,081.98, while the NSE Nifty50 fell by 36.60 points (0.15 per cent) to settle at 24,435.50.
Here's how analysts are assessing today's (October 24) trading session:
Hrishikesh Yedve, AVP Technical and Derivatives Research at Asit C. Mehta Investment Interrmediates Ltd
On the daily chart, Nifty formed an inverted hammer candle, which occurred after the breakdown of a head and shoulder pattern. This candlestick formation typically indicates strength. Thus, the 24,378 level serves as crucial short-term support. If Nifty holds above this, it might witness a pullback towards the 24,600–24,700 zone, which coincides with the neckline of the head and shoulder pattern. On the other hand, if Nifty breaks below 24,370, it could drift lower towards the 24,200–24,000 levels. Traders are advised to use any bounce to book profits, considering the overall weakness.
Shrikant Chouhan, Head of Equity Research, Kotak Securities
The intraday market texture is weak but oversold hence, we could expect one quick pullback rally if the market succeeds to trade above 24600/80500. Above the same, it could bounce back till 24650-24700/80700-80900. On the other side, below 24380/79900 the selling pressure is likely to accelerate. Below which, the market could slip till 24300-24250/79600-79400.
Rupak De, Senior Technical Analyst, LKP Securities
The Nifty formed an inverted hammer pattern on the daily chart, suggesting a possibility of recovery in the near term. Immediate support is placed at 24,350, where the 38.20 per cent Fibonacci retracement level lies. Going forward, if Nifty holds above 24,350, it might recover towards 24,700-24,750. A further recovery above 24,750 could lead to a move towards 25,250. However, a significant correction may occur if Nifty falls below 24,350.