Nifty slips below 10,300 amid June FO expiry, IMF warning on growth

Indian markets remained volatile on June 25, tracking muted trends in other Asian markets and as traders rolled over their positions from June series to July series. The S&P BSE Sensex failed to close above 35,000 while the Nifty50 ended a shade below 10,300.

World stocks slipped to their lowest in over a week as a surge in US coronavirus cases and an IMF warning of a nearly 5 percent drop in the global economy dented sentiment.

The Sensex fell 26 points to close at 34,842 while the Nifty50 ends at 10,288, 16 points down.

Sectorally, action was seen in FMCG, healthcare, Bankex, and finance stocks while profit-taking was seen in IT, realty, oil & gas, and metals.

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“Following the F&O expiry, our markets were also volatile and undecided, finally ending with a negative bias for the day. This was also in sync with generally lacklustre global markets,” said Vinod Nair, Head of Research at Geojit Financial Services.

“Cautiousness was visible as the IMF revised its GDP growth outlook for India and the infections continued to rise. Sectoral indices were also mixed, with FMCG being the highest gainer,” he said.

Some fatigue was building into markets and investors should be cautious, Nair said.

The Nifty50 and Sensex rallied over 8 percent each in the June series. The Nifty Bank posted its biggest gain in the period since March 2019 series. Data suggests that 45 Nifty stocks recorded gains in the June series, with Bajaj Finance and Bajaj Finserv emerging as top gainers.

The broader markets outperformed the benchmark indices. The S&P BSE Midcap index rose 0.62 percent, while the S&P BSE Smallcap index closed 0.76 percent higher.

Top Nifty gainers included Bajaj Finance, Hero MotoCorp, Kotak Mahindra Bank and ITC.

Top Nifty losers included IOC, BPCL, Hindalco, and Asian Paints.

Stocks & Sectors

Sectorally, the S&P BSE FMCG index rose 2.2 percent followed by the S&P BSE Healthcare index that gained 1 percent, and the S&P BSE Bankex was up 0.6 percent.

Profit-taking was seen in the S&P BSE IT index that fell 1.5 percent, followed by the realty index that fell 0.94 percent and the oil & gas index was down 0.95 percent.

A volume spike of more than 100 percent was seen in stocks like Adani Enterprises, Idea Cellular, JustDial and Century Textiles.

Long buildup was seen in stocks like Lupin, Dabur India and Godrej Consumer Products.

Short buildup was seen in stocks like UltraTech Cements HCL Technologies, and NTPC.

More than 100 stocks on the BSE hit a 52-week high. These included Ruchi Soya, IOL Chemicals, Biocon, Gujarat Gas and Rallis India.

Stocks in news

IIFL Finance shares were up 10 percent after the promoter of the company increased their stake.

Canara Bank stock was down almost 4 percent after the company posted a loss of Rs 3,259.33 crore for the quarter ended March 2020.

Indian Overseas Bank stock price surged almost 10 percent after the company posted a net profit in the quarter ended March 2020.

Bank of India share price fell over 7 percent after the public-sector lender reported a massive loss for the March quarter.

Bharti Infratel stock price shed over a percent following the board’s decision to extend the deadline for its merger with Indus Towers by two months to August 31, according to a regulatory filing.

Steel Strips Wheels shares were up over a percent after the company bagged exports orders for over 13,000 wheels for EU Caravan Trailer and US Mobile Home Market.

Technical View

The Nifty formed a small bullish candle on the daily charts.

In the next trading session, if the bulls manage to defend the day’s low of 10,194 then a sideways move with an initial target of 10361 can be expected

A close above 10,361 can take the index towards 10,406–10,463 levels

Trend reversal in the favour of the bulls shall not be expected unless the Nifty closes above 10,553.  A breach of 10,194 will confirm weakness in the prevailing trend, Mazhar Mohammad of Chartviewindia.in said.

“We advise traders to refrain from creating fresh long positions, whereas intraday traders can consider fresh shorts below 10,190 levels for a modest target of 10,090 with intraday high as the stop,” he said.

Disclaimer: The views and investment tips expressed by experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

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