Stock Market Expiry- Top Few things before the opening bell

Bears seem to have kept tight control over Dalal Street, pushing the benchmark indices down by nearly one percent on September 28 ahead of the monthly expiry of futures & options contracts. The fall in global peers and consistent FII selling weighed on sentiment.

The BSE Sensex plunged 509 points to 56,598, while the Nifty50 fell 149 points to 16,859 and formed Doji kind of pattern on the daily charts, indicating indecisiveness among bulls and bears about the future market trends.

"Normally, such formation after a reasonable weakness calls for a pullback rally from the lows. But the overall market trend is still weak and there is no confirmation of any buying emerging from the lows," said Nagaraj Shetti, Technical Research Analyst at HDFC Securities.

He thinks the Nifty is now placed at the crucial support of 16,800 levels as per the concept of change in polarity. The said level has been a crucial value area in the past and has witnessed significant moves from its supports and its resistances in the past.

Having declined down to the support, there is a possibility of a minor pullback rally in the market from near 16,800-16,750 levels in the next 1-2 sessions. Immediate resistance is placed at 17,000 levels, the market expert said.

The selling pressure was also seen in broader markets as the Nifty Midcap 100 and Smallcap 100 indices fell 0.3 percent and 0.5 percent, respectively, while India VIX, the fear index, increased by 2.44 percent to 22.10 levels.

Inflation shifts investor attention away from China slowdown, says economist

A generational surge in inflation in advanced economies is stealing the attention of investors from a generational slowdown in China that is arguable of much greater importance for the long-term global outlook, according to the Group Chief Economist at Capital Economics.

"We recently lowered our forecast for this year's officially reported GDP growth rate to 3 percent from 4 percent – the government's 5.5 percent target set in March has been quietly abandoned – but in reality don't expect the Chinese economy to grow at all," Neil Shearing said in a note.

"The conventional response in Beijing to such weakness would be to loosen policy. But the past week has again revealed the constraints under which policymakers in China are operating."

China's zero-Covid policy has hurt growth in recent months even as a slowing global economy weighs on demand for its exports. Central banks across the world are also tightening monetary policy at a sharp pace to curb red-hot inflation, further exacerbating growth woes.

Financial markets have whipsawed. The S&P 500 sank to the lowest since December 2020 overnight and the US Treasury yields continued to rise, with the 10-year rate climbing to the highest since April 2010.

After a decade-long run of giddying expansion, mounting evidence of bad economic news from China reflects a structural slowdown that's now in full train. Investors can be forgiven for having more immediate concerns on their mind, but they should be paying attention."

Amid a surge in the dollar, the People's Bank of China is trying to prevent the renminbi from going much beyond the seven-to-a-dollar level. The Chinese central bank on Monday hiked the reserve ratio for currency forwards, a move aimed at deterring speculation against the renminbi.

While there is nothing sacrosanct about the seven-to-a-dollar level, it is the line in the sand that policymakers appear to have drawn amid concerns that an overt weakening of the currency could encourage capital outflows, which would, in turn, destabilize the domestic financial system, Capital Economics said.

Open Demat Account to Check top Gainers & Losers

 Hester Biosciences | CMP: Rs 2,173.45 | The share jumped over 10 percent after the company informed investors it has been able to meet demand for goat pox vaccine in the country. The goat pox vaccine is used to immunise cattle against the lumpy skin disease. A total of 97,435 cattle have died in the country due to the viral infection, showed government data as of September 23.

Sterlite Tech | CMP: Rs 159.25 | The scrip was down over 7 percent after the company said its chief financial officer has resigned. "This is to inform that Mr. Mihir Modi, Chief Financial Officer and Key Managerial Personnel of the Company has tendered his resignation and will be relieved from his duties with effect from close of business hours of Friday, October 14, 2022," said the company in a regulatory filing.

PI Industries | CMP: Rs 3,010 | The stock ended in the red on September 26. Promoter Mayank Singhal offloaded 0.6% stake or 10 lakh shares in PI Industries via open market transactions. These shares were sold at an average price of Rs 3,150 per share.

Mahindra & Mahindra Financial Services | CMP: Rs180.30 | The stock price fell over 7 percent on September 26. Jefferies has kept underperform rating on Mahindra & Mahindra Financial Services with a target at Rs 155 per share. It believes that RBI ban on outsourcing collections & recovery could lead to 75-80% drop in recoveries. This could lead to higher loan losses/LGD till it readjusts its processes.

Fortis Healthcare | CMP: Rs 258.50 | The share price ended in the red amid weak market conditions. Foreign research house Nomura has kept buy rating on Fortis Healthcare with a target at Rs 319 per share. "The legal overhang have limited impact on operations. The company has recorded improvement particularly in the hospital business in recent past," it added.

Alicon Castalloy | CMP: Rs 893.05 | The scrip ended in the red on September 26. The company said it has been selected by Jaguar Land Rover in the United Kingdom to supply the eAxle Housing, a critical product for their eMobility platform. This component is an integrated eMotor and Transmission Housing. The order win is a large, multi-million dollar order for deliveries over five years and is the highest ever order win from a single customer for a single product in the Company’s history. The product will be manufactured at Alicon’s facility at Pune, India, it added.

Open Demat Account to Check Top Gainers & Losers

 Indian benchmark indices ended lower for the fourth consecutive session on September 26 with Nifty closing near 17,000 amid selling across the sectors barring IT. At close, the Sensex was down 953.70 points or 1.64% at 57,145.22, and the Nifty was down 311 points or 1.79% at 17,016.30.

Hindalco Industries | CMP: Rs 373.15 | The share tumbled close to 6 percent after one of the biggest clients of subsidiary Novelis Corporation cut its earnings outlook due to ongoing slowdown in the global economy. Ball Corporation, one of the largest beverage can makers in the US, slashed its five-year volume growth outlook for North America citing weak demand conditions. The company also highlighted that volumes for beverage cans could get weaker in the short term due to the impending recession in the US and falling aluminium prices.

Harsha Engineers | CMP: Rs 485.90 | The stock price surged 47 percent against issue price as it debuted today. The momentum in the stock is backed its IPO subscription numbers, strong financials, and robust growth prospects. Harsha Engineers has raised Rs 755 crore through its public issue that had seen a strong 74.70 times subscription during September 14-16.

Forbes & Company | CMP: Rs 694.90 | The stock price jumped 5 percent after the Board of Directors of Forbes & Company at their Board Meeting held on September 26, 2022 approved the Scheme of Arrangement between Forbes & Company Limited and Forbes Precision Tools and Machine Parts Limited and their respective shareholders.

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