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Market Update

Nifty : 22,913.15 -19.75 (-0.09%)

Sensex : 75,735.96 -203.22 (-0.27%)

* The equity benchmarks Nifty and Sensex ended in the red with slight losses as pressure from financial and IT stocks weighed on the indices, overshadowing gains in auto ancillary, PSU banks, metals, and real estate stocks. However, broader market performance was stronger, with the Nifty 500 stocks advance-decline ratio favoring gainers at 3.5:1.5.

* Both the Nifty mid-cap and small-cap indices saw over a 1% rise, as traders shifted focus from large-cap stocks to smaller and mid-sized stocks, which had fallen by 25-35% in recent sessions. The Nifty dropped by 20 points, or 0.1%, to close at 23,913, while the Sensex fell by 200 points, or 0.3%, ending at 75,735.

* The PSU Bank Index rose by 1.7% following the news that the RBI had purchased Rs 40,000 crore through open market operations (OMO) to boost liquidity in the banking system. PNB announced a reduction in interest rates by up to 25 basis points on retail loans, including housing and auto loans, after the RBI rate cut. PNB and Bank of India gained 3% and 5%, respectively.

* The Nifty Metal Index surged by 2% as base metal prices on the London Metal Exchange (LME) rose, with stocks like National Aluminum, Vedanta, Jindal Steel, SAIL, and NMDC gaining between 2-3%.

* Globally, the US market hit a record high, while the European market showed mixed results after the US central bank's meeting minutes indicated that interest rates were unlikely to be cut soon, amidst concerns about the inflationary impact of Trump's policies.

Technical Outlook:

* Nifty index opened negative and after the slight recovery in the initial hour, it traded in a narrow range of around 100 points for the rest of the day. It moved in a consolidative manner and gained some momentum towards the end but with lack of follow up above 22923 marks.

* It formed a bullish candle on daily frame and has got stuck in a wider band from the last five sessions. Now if it manages to cross and hold above 22950 zones then bounce could be seen towards 23150 then 23250 zones while supports are intact at 22800 then 22725 zones.

Derivative Outlook:

* Nifty future closed negative with losses of 0.13% at 22934 levels. Positive setup seen in NHPC, BSE, IGL, Shriram Finance, Chambal Fertilizer, MGL, NTPC, NMDC, CIPLA, Hindalco and JSW Steel while weakness in Nykaa, Laurus Labs, Cyient, TechM, HCL Tech, Tata Consumer, VBL, LTIM, Glenmark, Dmart, City Union Bank and Tata Communication.

* On option front, Maximum Call OI is at 23500 then 24000 strike while Maximum Put OI is at 23000 then 22500 strike. Call writing is seen at 23500 then 23000 strike while Put writing is seen at 22300 then 22800 strike. Option data suggests a broader trading range in between 22500 to 23500 zones while an immediate range between 22800 to 23300 levels.

* PNB slashes retail loans rates by 25 bps – PNB announced reduction in interest rates by up to 25 basis points on retail loans, including housing and auto loans, following the RBI rate cut.

* Garden Reach Shipbuilders & Engineers (GRSE) - Company has secured an order worth 1.23 billion Indian rupees from the Ministry of External Affairs, Government of India. The contract is for funding of normal refit of Mauritius coast guard ship CGS Barracuda (MCGS Barracuda) to be undertaken by the company.

* Cars24 to drive into personal loan space, expand car loan access - Used cars marketplace Cars24, which has been offering financing options to customers purchasing cars from its platform, is transforming into a full-fledged lending platform, a top executive of the company told Mint. The company will now offer car loans and personal loans to buyers beyond its platform, and will also help customers track and improve their credit scores through its newly launched platform, Loans24.

* Ethos – Unicommerce eSolutions partnered with Ethos. The company will adopt Unicommerce eSolutions's Uniware suite to enhance its luxury e-commerce experience.

* L&T – Company got a “large” order from Hindalco for setting up an 850,000 tons/year greenfield alumina refinery plant in the eastern Indian state of Odisha.

* Vedanta Creditors Clear Split of India Business Into Five Units - Vedanta Ltd.’s creditors and shareholders approved a long-standing plan to split the Indian mining conglomerate into five businesses, a step that will simplify the group’s structure and reduce its debt burden. The demerger could provide new funding sources and increase financial transparency across the group. Following the split, Vedanta shareholders will receive one share in each of the new companies, for every share held.

* HPCL - Company purchased crudes from the Middle East and West Africa for loading next month. Grades include Iraq’s Basrah Medium, Nigeria’s Forcados and Angolan Nemba crude.

Global Market Update

* European Market - European stocks steadied from the previous day’s slide, as bond yields pulled back and President Donald Trump signaled it would be possible to reach a new trade deal with China. UK, Germany and France Index declined 0.2% each while Germany Index advance 0.2%.

* Asian Market - Asian markets turned negative Thursday amid Federal Reserve concerns that US President Donald Trump's tariffs and immigration measures could reignite inflation. Minutes from the US central bank's January meeting suggested officials were not likely to cut interest rates anytime soon -- having reduced them at three successive meetings -- citing worries about the impact of Trump's policies. China, Hong Kong and Australia Index declined over 1%.

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