SGX Nifty Indicates Positive Opening; Hero Motocorp Q2 Results Beat Estimates

At 8:15 am IST, SGX Nifty Futures were trading at 18,220, compared with Nifty’s close of 18,102, Friday.

Market Pulse: Confirmed Uptrend

Distribution Day Count:

Nifty50: Four Nifty Midcap100: Three Nifty Smallcap100: Six

Global Stock Markets: Dow 30, +0.5%; Nasdaq, +1%; S&P 500, +0.7%; Nikkei, +0.5%; Kospi,+1.1%; Shanghai Composite, -0.1%.

Last week, Nifty started on a positive note as it closed 0.9% higher on Monday and reclaimed its 21-DMA. It was then down in three consecutive sessions on low volume. On Friday, the index reclaimed its 21-DMA. After a volatile first hour, it trended up and closed above 18,100. It was a mixed action on the sectoral front. Nifty IT (+2.8%) and Energy (+2.7%) were the top performers for the week. Financial-related sectors declined the most. On Friday, FIIs and DIIs net buying was Rs 511 crore and Rs 550 crore, respectively.

Nifty reclaiming its 21-DMA is a good sign as it opens up possibilities for another upward move. The distribution day count currently stands at four. If the market succumbs to selling pressure and breaches its 50-DMA, we may change the market status to an Uptrend Under Pressure. Nifty is trading less than 1% above its 50-DMA. Reducing exposure to stocks breaking below their 21- or 50-DMA on higher volume is important.

Key News

Hero Motocorp’s Q2 FY22 results beat estimates on all fronts. PAT was down 16.7% y/y to Rs 794 crore. Revenue was down 9.8% y/y to Rs 8,453 crore. Margin contracted 110bps y/y to 12.6%.

Pi Industries’s Q2 FY22 results missed estimates on all fronts. PAT grew 5.5% y/y to Rs 229.6 crore. Revenue grew 17% y/y to Rs 1,354 crore. Margin contracted 270bps y/y to 21.5%.