Bank, financials help Sensex, Nifty end higher

Benchmark indices Sensex and Nifty closed higher on September 4, supported by gains in shares of bank and finance heavyweights, including HDFC twins, ICICI Bank and State Bank of India.

The market remained volatile during the session as investors remained cautious in the weak macroeconomic environment. However, improved global cues and rupee’s fresh rise against the US dollar offered some relief.

The Indian currency closed the day with a gain of 27 paise at 72.12 per dollar.

After a subdued start of the session, the market slipped in the red and traded with negative bias in the first half. However, it managed to pull back from the lows, post noon and ended the session higher.

Market observers doubt that the market will hold the gains as there is no fresh positive trigger for the market at this juncture.

“We continue to maintain cautious stance on the Indian market in the absence of any positive triggers at home. We believe the recent measures undertaken by the government could take some time to yield the desired results. Further, uncertainty in global markets would induce more volatility and could negatively impact investors’ sentiments,” said Ajit Mishra Vice

President, Research, Religare Broking.

Sensex closed 162 points, or 0.44 percent, higher at 36,724.74, with 18 stocks in the green. The Nifty index logged a gain of 47 points or 0.43 percent to settle at 10,844.65, with 30 stocks ending in the positive.

With a gain of 2.97 percent, Bharti Airtel ended the day as the top gainer in the Sensex index. It was followed by State Bank of India, Tata Steel, Vedanta, NTPC and HDFC Bank, that logged gains between 2.46 percent to 1.73 percent.

Maruti Suzuki fell 3.64 percent to close as the top loser in the Sensex kitty. Sun Pharma, Tata Motors, Asian Paints, IndusInd Bank and Mahindra & Mahindra also featured among losers, falling between 2.97 percent to 1.92 percent.

Midcaps and smallcaps underperformed Sensex as their sectoral indices on BSE climbed up to 0.29 percent.

Among the sectoral indices, BSE Telecom emerged as the top gainer, clocking a gain of 1.91 percent. On the other hand, BSE Auto finished as the top loser, falling 1.74 percent. BSE Metal and Bankex also rose over 1 percent.

The breadth of the market turned flat after the recovery in midcaps, with the advance-decline ratio at 1:1.

Top news of the day:

India and Pakistan on September 4 agreed on visa-free travel of Indian pilgrims to the Kartarpur Sahib Gurudwara without any restrictions based on their faith.

Delhi has dropped by six places to 118th position on a list of the world’s most liveable cities due to increase in cases of petty crimes and poor air quality, an annual survey by the Economist Intelligence Unit showed.

Heavy rains hit Mumbai. India Meteorological Department (IMD) has issued a red alert, said heavy rainfall will continue for the next 24 hours.

Hong Kong leader Carrie Lam announced the withdrawal of an extradition bill that triggered months of unrest and threw the Chinese-ruled city into its worst crisis in decades, Reuters reported.

Maruti Suzuki India has decided to suspend production at its Gurugram and Manesar plants in Haryana for two days on September 7 and 9. The auto major had reduced its production by 33.99 percent in August, making it the seventh straight month of reduction amid a slowdown in demand.

Stocks in news:

Shares of BEML jumped 4 percent to Rs 795.50 on BSE after the government invited Expression of Interest (EoI) for disinvestment in the company’s subsidiary.

Vascon Engineers shares surged 17 percent to Rs 12.12 after the company received tender from Maharashtra State Police Housing & Welfare Corporation for construction of staff quarters along with multipurpose hall in Mumbai amounting to Rs 465 crore.

Breaking the winning run of two successive sessions, shares of IDBI Bank fell 6.08 percent to Rs 27.05, mainly on account of profit booking.

Shares of Maruti Suzuki India fell 3.64 percent to Rs 5,829.75 after the company said it has decided to shut down passenger vehicle manufacturing plants at Gurugram and Manesar in Haryana on September 7 and 9.

Shares of Gujarat Alkalies and Chemicals added as much as 7.25 percent to settle at Rs 421 after the company said it is going to consider sub-division of equity shares.

Shares of Ashok Leyland cracked 4.21 percent to Rs 62.60 after the company reported a fall of 70 percent in medium and heavy commercial vehicles (M&HCV ) truck sales in the domestic market in August 2019.

Shares of VST Tillers Tractors rose 8.48 percent to Rs 1,113 after the company said its tractor sales rose 57 percent at 813 units in August 2019, compared to 517 units in the year-ago period.

Shares of Sun Pharmaceutical Industries declined 2.97 percent to Rs 426.40 after SEBI ordered a forensic audit against the company.

Global update:

Easing worries over political risk in Britain and Italy helped stocks rise with the pound bouncing from three-year lows after a parliamentary vote raised the prospect of another delay to Brexit, Reuters reported.

Asian stocks rose following a report showing that growth in China’s service sector accelerated despite broader economic headwinds. Besides, reports that a controversial extradition bill is set to be withdrawn in Hong Kong also influenced the mood.

Shanghai Stock Composite Index climbed 0.93 percent, while Hang Seng surged 3.90 percent. Japan’s Nikkei inched up 0.12 percent and Korea’s Kospi gained 1.16 percent.

Technical view:

Nifty witnessed a technical bounce back to reclaim 10,800 levels and formed a bullish candle on the daily candlestick charts after a massive fall seen in the previous session.

The index is still trading below crucial short term moving averages and despite the bounce, the trend is still negative, suggest experts. Traders are advised to trade with strict stop losses as long as the index trades above 10,756-10637 levels.

“As long as Nifty sustains above 11,756 levels bulls can remain slightly optimistic. In case if bulls eventually manage a close above 11,042 levels then traders can remain confident that recent bottom of 10,637 can hold for some more time,” said Mazhar Mohammad, Chief Strategist – Technical Research & Trading Advisory, access to India’s fastest growing financial subscriptions service Pro for as little as Rs 599 for first year. Use the code “GETPRO”. Pro offers you all the information you need for wealth creation including actionable investment ideas, independent research and insights & analysis For more information, check out the website or mobile app.