Nifty holds 11,300 on a volatile day; mid smallcaps outperform

Indian stocks ended in the red for the second day in a row on August 13. The S&P BSE Sensex slipped 59 points to close at 38,310 while the Nifty50 managed to hold on the crucial  11,300 levels as it slipped eight points.

Mixed global cues and profit-booking at higher levels capped the upside.

“The markets gave up initial gains in another volatile day of trade to end the day flat with a negative bias. Global cues were also mixed as Asian markets ended positively, while European markets were trading in the negative,” Vinod Nair, Head of Research at Geojit Financial Services told Moneycontrol.

Uncertainty in global markets emerged due to doubts over the US stimulus package and the outcome of the US-China trade meeting over the weekend.

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Domestic stock valuation concerns and high rate of viral infections impacted the Indian markets, Nair said. Markets seem to be in a wait-and- watch mode and investors are advised to tread cautiously and accumulate stocks.

Sectorally, selling pressure was seen in telecom, healthcare, banks, and energy stocks, while some action was seen in capital goods, industrials, consumer durables and metals stocks.

The broader markets outperformed benchmark indices.

Top Nifty gainers included Titan Company, L&T, Hindalco and Tata Motors.

Top Nifty losers included Sun Pharma, Bharti Airtel and Eicher Motors.

Stocks & Sectors

Sectorally, action was seen in the S&P BSE Capital Goods index that was up nearly 4 percent. The S&P BSE Industrials rose 3 percent and the consumer durables index closed with the gains of 2 percent.

Profit-taking was seen in the S&P Telecom index that was down 1.4 percent followed by the S&P BSE Healthcare index that fell 0.6 percent. The S&P BSE Bankex was down 0.2 percent.

Volume spike of over 100 percent was seen in stocks like L&T, Tata Power, and Ashok Leyland.

Long buildup was seen in stocks like Ashok Leyland, Shriram Transport, and Chola Finance.

Short buildup was seen in stocks like Bharti Airtel, GAIL India and Tata Steel.

More than 100 stocks on the BSE hit a 52-week high. These included Orissa Minerals, Galaxy Surfcants and VST Tillers.

Stocks in news

Hindalco ended 3 percent higher a day ahead of Q1 earnings while Novelis reported a 27 percent drop in Ebitda.

Bharti Airtel ended off lows after reports said that MSCI weightage cut of the company could be reversed.

Tata Power Company share jumped more than 5 percent after the firm reported a consolidated profit of Rs 268.1 crore for the June quarter , a 10.3 percent year-on-year increase .

eClerx Services share surged 20 percent after the company reported consolidated net profit at Rs 51.77 crore, up 30.05 percent YoY.

Aurobindo Pharma stock shed over 5 percent after the company declared its June quarter numbers. The drugmaker on August 12 reported a 22.8 percent year-on-year (YoY) rise in consolidated profit at Rs 780.7 crore in the June quarter.

Ashok Leyland stock surged over 14 percent despite the company reporting a consolidated net loss of Rs 388.82 crore for the first quarter ended June 30.

Power Finance Corporation stock gained almost 4 percent after the company’s Q1 net profit rose 22.9 percent YoY at Rs 1,699.6 crore against Rs 1,382.8 crore. Revenue was up 15.6 percent at Rs 8,757.7 crore against Rs 7,577.3 crore, CNBC-TV18 reported .

Kaveri Seed Company stock shed over 5 percent after consolidated net profit went up 28.7 percent at Rs 296 crore against Rs 230 crore YoY.

Aditya Birla Fashion and Retail stock price jumped over 10 percent after the company declared its Q1 numbers.

Technical View

The Nifty formed a Doji candle on the daily charts, which suggests a struggle between the bulls and the bears

The index opened positive but failed to hold above 11,350 zone and remained consolidative for the most part of the session.

Follow-up buying was missing near 11,350 zones but at the same time, declines were being bought.

“The Nifty has to continue to hold above 11,200 zones to witness an up move towards 11,400 then 11,500 and higher zones, while on the downside support exists at 11,200 then 11,150 zones,” Chandan Taparia, Motilal Oswal Financial Services Limited, said.

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