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SGX Nifty Indicates Muted Opening; Retail Inflation Rises to 7.6% in October

Posted Date: November 13 2020

Market Preview

At 8:00am IST, the SGX Nifty Futures was trading at 12,643, compared with Nifty’s close of 12,690 yesterday.

Market status: Confirmed Uptrend

Distribution Day: Zero

Global stock markets: Dow 30, -1.1%; S&P, 1.0%; Nasdaq, -0.7%; Nikkei, -1.1%; Kospi, -0.3%; Hang Seng, -0.7%

Yesterday, Nifty made a gap-down opening near 12,700. It remained volatile and traded in the narrow range to close 0.5% lower. Though the index declined more than 0.2%, volume was lower than the previous day. So the session did not qualify for a distribution day. After gaining for the eighth consecutive session, Nifty closed in the red and is currently trading 5.8% and 8.6% above its 21- and 50-DMA, respectively. In the broader market, both Midcap and Smallcap showed outperformance as compared with the general market and closed 0.6% and 1.3% higher, respectively.

On the sectoral front, mixed reactions were observed. Nifty FMCG (+1.3%) advanced the most, followed by Nifty Realty and Nifty Media, which advanced 0.7% each. On the flip side, the rally in financial stocks came to a halt as Nifty Bank, Nifty PSU Bank, and Nifty PVT Bank closed 1.8–2.3% lower. Market breadth remained in favor of advancers. FIIs’ net buying was Rs 1,514 crore, while DIIs’ net selling was Rs 2,239 crore.

Currently, we are in a Confirmed Uptrend and are open to adding new positions coming out of proper base formations. We will look for leadership among some good stocks to push the market up. On the flip side, tracking distribution days is crucial. An accumulation of distribution days can halt the uptrend.

Key News

Fortis Healthcare (Nse) reported Q2 FY21 results. PAT was down 87.5% y/y to Rs 15.5 crore and revenue was down 18% y/y to Rs 994 crore. Q2 FY21 diagnostics business gross revenue was at Rs 282.4 crore compared with Rs 276.6 crore in Q2 FY20.

Cochin Shipyard reported Q2 FY21 results. PAT was down 47.7% y/y to Rs 108 crore and revenue was down 32% y/y to Rs 657 crore.

Eicher Motors  reported Q2 FY21 results. PAT was down 40% y/y to Rs 343 crore and revenue was down 2% y/y to Rs 2,133 crore. The company's two-wheeler arm Royal Enfield sold 1,49,120 motorcycles, down 9% y/y.

Reliance Industries will invest up to $50M in Breakthrough Energy Ventures IILP.

-Retail inflation rises to 7.6% in October. It is at a nine-month high. September IIP was at 0.2% compared with -7.4% in August.

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, 72%; Rally Attempt, 8%; Uptrend Under Pressure, 20%; Downtrend, 0%.

For the 24 developed markets tracked by our institutional research team, the market status breakdown is as follows: Confirmed Uptrend, 88%; Rally Attempt, 0%; Uptrend Under Pressure, 12%; Downtrend, 0%.


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