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Informist, Thursday, Nov. 14, 2024

By Anjali Singh

MUMBAI – Headline indices closed slightly lower Thursday after moving in a thin range for most of the session. The fall was limited as the market entered oversold territory following a sell-off in the previous two sessions, analysts said. The benchmark indices, which have declined over 2% in the sell-off in the previous two sessions, closed lower on Thursday despite over half of stocks traded on the NSE ending higher. 

The indices opened higher on Thursday but the Nifty 50 index and the Sensex erased early gains to fall to a four-month low. The Nifty 50 closed at 23532.70 points, down 26.35 points or 0.1% and the Sensex closed at 77580.31 points, down 110.64 points or 0.1%. The Nifty mid-cap and small-cap indices outperformed the benchmark indices and closed higher on Thursday. The broader market indices and the benchmark indices had tested their crucial support of long-term moving average on Wednesday, analysts said. "Generally, we see a pause after the retest of this mark," Ajit Mishra, senior vice president of research at Religare Broking, said.

The 50-stock index and 30-stock index have fallen around 10% from the lifetime highs of 26277.35 points and 85978.25 points, respectively, hit on Sept. 27. "This downturn stems from multiple factors, including weak (Jul-Sept) earnings, which were affected by election-related disruptions, stress in retail lending (especially in microfinance and personal loans), and a slowdown in FMCG (fast-moving consumer goods) and festive consumption," Krishna Appala, senior research analyst at Capitalmind Research said in a note. 

Shares of fast-moving consumer goods companies were among the worst performers in the Nifty 50 index. Shares of Hindustan Unilever, Tata Consumer Products, and Britannia Industries fell 2.6-3.1%. Consequently, the Nifty FMCG fell 1.5%. The fundamentals of the sector are currently weak, analysts said. With urban demand weakening, disappointing quarterly earnings, and increased raw material prices, more downside in the sector is expected. Urban demand slowdown will create a problem in the next quarter as well, largely due to high inflation, Akriti Mehrotra, research analyst at StoxBox said. "Valuations are still getting towards comfortable zones, and we may see these stocks fall for a week or two before a bounce back," Mehrotra said.

Shares of select automobile companies such as Eicher Motors and Hero MotoCorp, were the best performers in the Nifty 50 index. Shares of Eicher Motors closed 6.4% higher after it reported its best-ever consolidated revenue for the September quarter late Wednesday. Some brokerages raised their target price and upgraded the stock following the earnings. Nomura Global Markets Research said the company's focus on its volume growth instead of sticking to margins is a positive. "It addresses our key concern on long-term volume growth and too-high margins, making entry of competitors very easy," Nomura said. Nomura upgraded its rating on Eicher Motors to 'neutral' from 'reduce'.

Shares of PI Industries fell 9% intraday after the company's management lowered its revenue growth guidance for 2024-25 (Apr-Mar). The stock, which ended 4% lower, was the worst performer in the Nifty 200 index. Shares of SKF India closed 7.4% lower and were the worst performers in the Nifty 500 index. The company's Jul-Sept net profit missed the Street's estimates.

Shares of Niva Bupa Health Insurance were listed at INR 78.14 on the NSE on Thursday, a premium of nearly 6% to the issue price of INR 74. The stock closed largely unchanged from the issue price. Two analysts at different brokerages suggested holding the stock for the long term. "We believe the under penetration of health insurance and rising middle class can sustain future growth for companies and the strong parent-backing has aided the company to get well-placed to grow faster in the sector," Prashanth Tapse, senior vice president of research at Mehta Equities, said in a note.   

* Of the Nifty 50 stocks, 20 rose and 30 fell

* Of the Sensex stocks, 9 rose and 21 fell

* On the NSE, 1,531 stocks rose, 1,269 fell, and 81 were unchanged

* On the BSE, 2,145 stocks rose, 1,813 fell, and 92 were unchanged

* Nifty FMCG: down 1.53%; Nifty PSU Bank: down 0.7%; Nifty Media: up 2.26%

BSE                                               NSE

Sensex: 77580.31, down 110.64 points or 0.14%     Nifty 50: 23532.70, down 26.35 points or 0.11%

End

Edited by Saji George Titus

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