Summary of the Day's Market Performance

• Indian equity markets remained under pressure for the fifth consecutive session on October 4, driven by a broad-based sell-off across sectors.

• The Sensex dropped by 808.65 points, closing at 81,688.45, while the Nifty ended down 200.30 points at 25,049.80.

• The BSE Midcap and Smallcap indices lost nearly 1% each.

Performance of Key Sectors

• Most sectoral indices ended in the red, with auto, FMCG, realty, power, media, telecom, and oil & gas sectors down by 1-2%. However, the PSU Bank and IT sectors managed to post gains.

• Geopolitical Tensions: The continued escalation of the conflict in the Middle East has created global uncertainty, especially in the energy markets. Crude oil prices have surged sharply, although they may be tempered by OPEC+ plans to increase production.

• Sell-on-Recovery Strategy: Investors have adopted a sell-on-recovery approach as they remain cautious amidst rising global tensions and shifting fund flows to cheaper markets like China.

• IT Sector Resilience: IT stocks gained, driven by expectations of potential benefits from US rate cuts and the sector's defensive nature in uncertain times.

Market Transactions:

• Foreign Institutional Investors (FII): ₹-9,896.95 crore (Net Sellers)

• Domestic Institutional Investors (DII): ₹8,905.08 crore (Net Buyers)

Foreign institutional investors continued to sell Indian equities, while domestic institutions stepped in as net buyers, but their efforts were insufficient to halt the market's decline.

• Middle East Conflict: The rising tensions in the Middle East are driving up crude oil prices, raising inflationary concerns for India, particularly in sectors like FMCG and auto, which are sensitive to rising input costs.

• Fund Flows: The shift of FII funds to markets with lower valuations, such as China, is further adding pressure to the Indian market.

• Bearish Sentiment: The pessimism in the market is expected to persist in the near term as investors grapple with global headwinds.

• Biggest Weekly Fall Since June 2022: The market recorded its largest weekly drop since June 2022, erasing nearly ₹18 lakh crore in market capitalization.

• Nifty Down Nearly 5%: After snapping a 3-week gaining streak, the Nifty dropped by almost 5% this week, with the Nifty Realty index plunging by 8%.

• Sectoral Performance: All sectoral indices, except Nifty Metal, ended lower.

Key Stock Movements and News

• Biggest Losers: M&M, Bajaj Finance, Nestle India, BPCL, and Asian Paints led the declines on the NSE.

• Biggest Gainers: Infosys, ONGC, Tata Motors, Wipro, and HDFC Life were among the few gainers.

• Bajaj Finance: The stock dropped by 3% after reporting its slowest AUM growth in six quarters during Q2.

• Oil India: Gained +5% as global crude oil prices continued to rise amid the Middle East tensions.

• Diffusion Engineers: Had a strong market debut, closing the day 21% higher than its IPO price of ₹168 per share.

• Wonderla Holidays: Approved a plan to raise ₹800 crore, boosting market sentiment for the stock.

• Panache DigiLife: Entered into a manufacturing and supply agreement with a US-based brand for advanced media gateway devices, signaling growth prospects.

• Ola Electric Mobility: Launched its "BOSS - Biggest Ola Season Sale" campaign for the festive season, potentially driving increased sales.

Brokerage Updates:

• Citi: Retained a 'buy' rating on Bank of Baroda, setting a target price of ₹300.

• HSBC: Issued a bearish outlook on Bajaj Housing Finance, forecasting a -27% downside.

• Jefferies: Maintained a 'hold' rating on SBI Cards, raising the target price to ₹795.

• Investec: Remains bullish on Cipla, predicting 12-13% growth in the Indian pharma market.

• Oil India: Continued upward momentum driven by global crude price movements.

• Bajaj Finance: Weak Q2 growth might pressure the stock in the near term, but long-term prospects depend on recovery in AUM growth.

• Diffusion Engineers: A strong debut makes it a stock to watch in the short term, particularly for IPO investors.

• Bank of Baroda: Positive outlook from brokerages and stable performance may offer a safe bet amidst market volatility.

The Indian markets continued their downtrend as geopolitical tensions, surging crude prices, and shifting FII funds weighed on investor sentiment. The bearish tone is likely to persist as investors remain cautious amid global uncertainties and rising inflation risks. Defensive sectors like IT offer some respite, while heavy selling is seen across sectors, particularly in auto, FMCG, and realty. Investors are advised to remain vigilant and focus on stocks with strong fundamentals or those likely to benefit from sectoral tailwinds.

😊Thank you for subscribing to our Market Wrap-Up. Stay tuned for tomorrow's update.

Disclaimer: The information provided in this newsletter is for informational purposes only and should not be considered financial advice.

Follow us on Social Media