SGX Nifty Indicates Muted Opening; Allcargo Logistics Revenue Dips While PAT Surges

Market Preview

At 8:00am IST, the SGX Nifty Futures was trading at 11,510, compared with Nifty’s close of 11,521 yesterday.

Market status: Uptrend Under Pressure

Distribution Day Count: Seven

Global stock markets: Dow 30, +0.08%; S&P, +0.5%; Nasdaq, +1.2%; Nikkei, +0.1%; Hang Seng, +0.1%; KOSPI, +0.2%

Yesterday, after a gap-up opening, Nifty remained volatile but traded in the narrow range for the majority of trading hours. Later, last hour buying interest from investors helped the index close above 11,500, holding decent gains. Volume was lower compared with the previous session. The action in broader indices was very constructive. Nifty Midcap and Smallcap closed 1.1% and 1.5% higher, respectively.

On the sectoral front, Nifty Pharma (+1.9%) outperformed, followed by Nifty PVT Bank (+1.9%) and Bank (+1.7%). Nifty Realty and Media were top losers, closing with a cut of 0.7% and 0.4%, respectively. The advance-decline ratio was skewed toward advancers. Of the 2,207 stocks traded, 1,105 advanced, 713 declined, and the rest remained unchanged.

As the market condition is in an Uptrend Under Pressure, investors should proceed ahead with caution. Unless a stock shows exceptional fundamental and technical strength, no new addition to the portfolio is advised. Investors should consider booking profits in stocks that have performed well and advanced 20–25% from their ideal buy points. Looking forward, we will change the status to a Downtrend, if more distribution days are added or if Nifty breaches its 50-DMA and 200-DMA. On the flip side, the status will be back to a Confirmed Uptrend if Nifty retakes the 11,795 level (high during the recent rally).

Key News

Allcargo Logistics reported Q1 FY21 results yesterday after market hours. Revenue from operations declined 11.5% y/y to Rs 374.9 crore. PAT increased 233% to Rs 94.7 crore, due to deferred tax credit during the quarter.

Va Tech Wabag reported Q1 FY21 results yesterday after market hours. Revenue from operations was down 5.6% y/y to Rs 430.9 crore. PAT increased 687% to Rs 5.0 crore.

REC’s board of directors approved the equity infusion of Rs 150 crore into a proposed joint venture with Power Finance Corporation Ltd., Power Grid Corporation of India Ltd and NTPC Ltd. for the establishment of Common Backend Infrastructure Facility (CBIF) for smart meters in the country.

O’Neil Market Condition Report

For the 24 emerging markets tracked by our institutional research team, the market status breakdown is as follows: Confirmed Uptrend, 34%; Rally Attempt, 4%; Uptrend Under Pressure, 54%; Downtrend, 8%.

For the 24 developed markets tracked by our institutional research team, the market status breakdown is as follows: Confirmed Uptrend, 21%; Rally Attempt, 9%; Uptrend Under Pressure, 70%; Downtrend, 0%.