Stock Market Today News | Sensex, Nifty, Share Prices Highlights: The benchmark equity indices closed Tuesday’s trading session in the negative territory a day after markets clocked the best trading session in 3 years. Banks were under huge pressure, Bank Nifty down fell over 4,051 points or almost 8%.
Commenting on the markets Jyoti Prakash Gadia, Managing Director at Resurgent India said that As the trends are emerging, the land slide victory as predicted by the exit polls does not seem to be happening. This is likely to make the government to have second thoughts on the difficult economic reforms and the same may not be as aggressive as earlier anticipated.
She also added that However the emphasis may shift partly to ground level welfare schemes and employment generation. Overall growth trajectory may however remain stable with emphasis on infrastructure development which may emerge as a consensus strategy in the long run.
The NSE Nifty 50 sees its biggest single-day fall since Feb 2022.
Courtesy: NSE
Shares of Adani Group companies faced significant pressure, tumbling 15% on June 4, following early vote-counting trends that showed Prime Minister Narendra Modi‘s Bharatiya Janata Party-led alliance leading in over 272 seats, although the extent of the victory remained unclear. What’s impacting the sell-off is the likelihood of the I.N.D.I.A. bloc gaining a significant number of seats, which would mean at least a strong opposition in Parliament.
Adani Green Energy, another power generation firm, plummeted 6% to ₹1,918, with a market cap of ₹3.04 lakh crore, compared to its previous close of ₹2,037.65. Adani Wilmar and Adani Total Gas also saw declines, falling 4% and 7% to ₹353.50 and ₹1,044.95, respectively.
The volatility index India VIX soared 33.33% to 28.05. This is the highest it has been in nine years. The India Volatility Index or VIX is an index introduced by the NSE to show the market’s anticipation of fluctuations. This gives investors a view of how the markets would fare in the near term. The NSE started this in 2003.
Shares of Adani Group companies faced significant pressure, tumbling up to 15% at the opening tick on Tuesday, June 4, following early vote-counting trends that showed Prime Minister Narendra Modi‘s Bharatiya Janata Party-led alliance leading in over 272 seats, although the extent of the victory remained unclear.
Adani Power, a key player in the power utilities sector, dropped about 14% to ₹756.65, with a market capitalization slightly above ₹3.20 lakh crore, down from ₹875 in the previous trading session.
Defence stocks pulled back as markets tracked election results trends. Hindustan Aeronautics fell 9.8%, Bharat Dynamics was down 9.7%, Paras Defence and Space Technology dropped 7%, Mazagon Dock Shipbuilders was down over 11%, ideaforge Technology fell 4.2%, Bharat Forge pulled back over 5%, and Cochin Shipyard dropped 8.8% tracking election results.
“Large-cap valuations appear favourable for the near term, while small and mid-cap stocks (SMIDs) are expected to outperform over the long term. Sectors such as manufacturing, banking, power, consumer, and capital goods are poised for strong performance. Although markets have already rallied post-exit polls, any further upside post-election results is likely to be capped. Volatility due to the ruling party securing fewer seats than anticipated should be seen as a buying opportunity for select bottom-up ideas. Regardless of election and budget outcomes, staying invested is advisable as the fundamentals favour long-term investors,” said Anil Rego, Founder and Fund Manager at Right Horizons.
“In case BJP alone does not clear the 272 mark and NDA falls short of 300 seats, it would be taken negatively in the immediate term. However, we do not expect markets to fall off the cliff. Nifty has strong support around the 22200-22500 mark and the same would be respected with the NDA government at the helm with less than 300 seats,” said Gaurav Dua, Head of Capital Market Strategy at Sharekhan at BNP Paribas commenting on the election results‘ early trends.
The railway stocks were trading low and felt the profit booking wave. Titagarh Rail Systems fell 6.6%, Rail Vikas Nigam dipped 13%, IRCTC pulled back 6.7%, BEML was down 7.2%, IRFC 8.4%, IRCON International fell 12%, Container Corp of India was down 9.8%, Railtel Crop of India dropped 9.8%, and Bharat Electronics also fell 9.8% on June 04 after the incumbent government wasn’t meeting the exit polls expectations.
V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services
“The steep fall is due to the results so far falling short of the exit polls which the market had discounted yesterday. If BJP doesn’t get a majority on its own there will be disappointment and this is getting reflected in the market. Also it is possible that Modi 3.O may not be as reform-oriented as the market expected and may turn more welfare- oriented. This is getting reflected in the strength in FMCG stocks.”
Most market analysts advise minimising trade at current volatile levels. According to them, investors must wait for the trends to stabilise and actual numbers to emerge. They believe that will give investors a better outlook to play for the long-term India story.
Courtesy: NSE
The Pharma index trade marginally higher by 0.40% at 18,943 led by Natco Pharma, Divis Labs, Sun Pharma, Torrent Pharma, Cipla, Mankind Pharma, Abbot India, Dr Reddy’s Lab, and Lupin.
Anand James, Chief Market Strategist, Geojit Financial Services suggests that the volatility decreasing is a positive indication – “VIX has eased 14%, which suggests that market expectation for downside surprise has eased. Historically VIX collapses immediately after maturity of the event, which suggests that call premia has limited room for upside, even if results bests exit poll outcome in favour of the ruling party. However, given the fact VIX is yet to slip below 20, an expectation of outlier is still very present. Our go to strategy for such a scenario is an iron condor or iron butterfly option strategy, which bets on VIX’s collapse, but also limits risk, in order to account for wild scenarios.”
Courtesy: NSE
The Bank Nifty index trades down over 3% trading near 49,200. The top laggards include AU Small Finance Bank, ICICI Bank, Febrela Bank, HDFC Bank, IDFC First Bank, Axis Bank, Kotak Mahindra Bank, IndusInd Bank, Bandhan Bank, and State Bank Of India.
The Adani group‘s listed stocks were trading down. Adani Ports and SEZ shares dropped 10% to an intraday low of Rs 1,426 a day after hitting its 52-week high of Rs 1,621.40 on June 03 on the back of exit polls showing clear victory for BJP-led NDA. ACC was down 9.4%, Adani Energy Solution saw a dip of 14%, Adani Green Energy crashed 18.5%, Adani Power fell 13.5%, Adani Total Gas was down 18.4%, the group’s FMCG firm Adani Wilmar was down 9.7%, Ambuja Cement dropped 10%, and NDTV pulled back 13.2%
Commenting on the derivative market outlook Anand James, Chief Market Strategist,Geojit Financial Services said that Nifty weekly contract has highest open interest at 24700 for Calls and 20200 for Puts while monthly contracts have highest open interest at 24000 for Calls and 20000 for Puts. Highest new OI addition was seen at 24700 for Calls and 21000 for Puts in weekly and at 27000 for Calls and 23000 for Puts in monthly contracts.
James also added FIIs increased their future index long position holdings by 105.54%, decreased future index shorts by -14.63% and in index options by 20.04% increase in Call longs, 18.04% increase in Call short, 21.20% increase in Put longs and 28.52% increase in Put shorts.
The Nifty PSE index opened with a 3.5% loss on Tuesday after early trends in the Lok Sabha polls indicated a weaker-than-expected performance for the Narendra Modi-led National Democratic Alliance. All 20 stocks on the Nifty PSE index are trading in the red, with NHPC and REC among the top losers. Non-index stocks such as SJVN, Bharat Electronics, IRCTC, and RVNL are also experiencing losses of up to 10%.
Adani Enterprises dipped 9.8% to an intra-day low of Rs 3,286.35 a day after touching its all-time high of Rs 3,743.90 on June 03.
The shares of state owned ONGC plunges over 6% to intra-day lows of Rs 262 on Tuesday June 4, 2024 after gaining 5% a day before.
The Nifty Smallcap 100 fell 5.2% to an intraday low of 16,218.20 from its previous close of 17,098.70.
The Nifty Midcap 100 fell 3.31% to 49,304 after opening at 50,667.
Blue Star, GSPL, Five Star, Crompton Greaves, and Natco Pharma were the top gainers in the Nifty Smallcap 100. While Central Bank, IRCON, NACL, HUDCO, and NBCC were the significant losers in the Nifty Smallcap 100 on June 04.
The shares of State Bank of India plunges over 5.80% to intra-day lows of Rs 850.25 on Tuesday June 4, 2024 a day after SBI becomes second largest bank surpassing the m-cap of Rs 8 lakh crore.
Macrotech Developers, Mankind Pharma, Polycab, Coforge, and Torrent Power were the top gainers in the Nifty Midcap 100. While SJVN, Bharat Dynamics, NHPC, LIC housing Finance, and SAIL were the major losers in the Nifty Midcap 100.
In the early trends of the Lok Sabha election counting, the BJP-led NDA has crossed the halfway mark with 278 seats, while the INDIA bloc is leading in 184 seats.