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Informist, Tuesday, Dec. 24, 2024

By Anjana Therese Antony

MUMBAI – The absence of major triggers in domestic and global markets, coupled with less participation from foreign investors due to the Christmas season, led to a muted movement in the Indian equity market Tuesday, analysts said. However, expensive valuations of domestic equities are likely to cap the upside in the near term and that many investors are shifting to large-cap stocks. "Indian equities were buoyant amid a challenging and eventful year with higher volatility. The markets were volatile with multiple global events, a slowdown in the Indian economy, tighter liquidity conditions and delayed government spending," Deepak Ramaraju, senior fund manager at Shriram Asset Management Co. said in a note. 

The volume of Nifty stocks traded fell 6% Tuesday to 117.66 million compared with Monday and that of Sensex constituents declined 41% to 4.82 million. Nifty 50 and BSE Sensex closed 0.1% lower each at 23727.65 points and 78472.87 points, respectively. The near-term support for the index is pegged at 23660-23690 points and resistance at 23800-23950 points, a senior technical and derivatives analyst at a domestic broking firm said. 

The recurring depreciation in the Indian currency has also been weighing on the domestic market, some analysts said. The Indian rupee ended at its record closing low of 85.20 a dollar Tuesday. Though the correction in October and November brought valuations to a comparatively better position, research analysts and fund managers do not see major foreign investor inflows in the near term as they believe stocks should fall more. FIIs were net sellers in the last six sessions. They net sold equities worth INR 1.68 billion on Monday and INR 35.98 billion on Friday. Benchmark indices fell around 10% from their record highs hit on Sept. 27.

The returns from the market were also lower than the previous year, with both benchmark indices rising around 9% so far in 2024, compared with about 22% rise recorded during the same period in 2023. In October and November, the market saw record FII outflows owing to multiple factors, including poor domestic earnings, downgrades in earnings estimates, expensive valuations, concerns about slower interest rate cuts by major global central banks, and worries about global supply of crude oil due to geopolitical tension between Russia and Ukraine as well as Iran and Israel, among others.

Among specific stocks, shares of most Tata group companies surged after reports said that the financial services subsidiary under the conglomerate, Tata Capital, was planning to raise INR 150 billion through its initial public offering. Tata Investment Corp. and Tata Chemicals were the top gainers among the group companies and closed higher by 4.2% and 3.2%, respectively. Tata Investment surged after eight consecutive sessions of fall.

Amber Enterprises India hit a record high of INR 7,498.70 after CNBC TV18 reported that the company was looking to demerge its electronics division. The stock closed 5% higher at INR 7,249.90. During the September quarter, revenue from this segment accounted for over 29% of the total revenue from operations of the company. The revenue was INR 4.92 billion in Jul-Sept and INR 8.80 in Apr-Sept, according to an investor presentation released after September quarter results. 

Whirlpool of India snapped a two-day losing run and closed 2.3% higher at INR 1,893.10 after the company signed a contract manufacturing agreement with PG Electroplast for some of its branded semi-automatic washing machines. Greaves Cotton surged to hit an all-time high of INR 264 after the company's subsidiary Greaves Electric Mobility filed a draft red herring prospectus for an initial public offering. The IPO comprises a fresh issue of shares worth up to INR 10 billion and an offer for sale of up to 189.40 million shares. Shares of the parent company closed at INR 247.62, up 8%. 

* Of the Nifty 50 stocks, 22 rose and 28 fell

* Of the Sensex stocks, 14 rose and 16 fell

* On the NSE, 1,443 stocks rose, 1,334 fell, and 102 were unchanged

* On the BSE, 1,977 stocks rose, 2,019 fell, and 96 were unchanged

* Nifty Metal: down 0.83%; Nifty PSU Bank: down 0.56%; Nifty Auto: up 0.57%

BSE                                               NSE

Sensex: 78472.87, down 67.30 points or 0.09%      Nifty 50: 23727.65, down 25.80 points or 0.11%

End

Edited by Akul Nishant Akhoury

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