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Weak global cues trounce key benchmark indices; IT stocks take hammering ahead of TCS results

FPJ Web Desk | Updated on: Monday, April 11, 2022, 04:20 PM IST

.Representative image | File photo
.Representative image | File photo
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The benchmark indices closed weak on April 11, first day of trading this week. Bank nifty has managed to settle at 37,613.80 levels with a loss of 138.25 points. On the sectoral front, Nifty Oil and Gas gained the most with 1.86 percent, while Reality and Media were up with almost 1 percent gain each. Nifty IT lost more than 1.4 percent. BSE Midcap and smallcap indices were up 0.4 percent each.

The Sensex declined over 482 points while the Nifty50 was down 0.62 percent.

At close, the Sensex was down 482.61 points or 0.81 percent at 58,964.57. The broad-based Nifty was down 109.30 points or 0.61 percent at 17,675.00. About 2,072 shares have advanced, 1,393 shares declined, and 121 shares are unchanged.

Among top losers on the Nify were HCL Technologies, Infosys, Larsen and Toubro, Wipro and SBI Life Insurance. Grasim Industries, Adani Ports, JSW Steel, UPL and Cipla were among the top gainers.

TCS shares rise ahead of earnings announcement

Share price of India's largest IT firm Tata Consultancy Services (TCS) rose on Monday ahead of the earnings announcements. Trading in TCS shares started on a positive note at Rs 3698 against its previous session's close at Rs 3686.85.

At 2.29 pm, TCS was trading 0.45 percent higher at Rs 3703.50. The scrip surged to a high of Rs 3711.25 and touched a low of Rs 3656.85 in the intra-day. India's second most valuable firm TCS is scheduled to announce its earnings for the quarter ended March 31, 2022, later in the day.

At close, the share was up Rs 13.35 or 0.36 percent at Rs 3,699.00.

Investors trim positions

Negative sentiment across Asian equities had a bearing on local stocks, as investors followed suit and trimmed their positions in risky counters. Investors, especially, shunned technology stocks ahead of TCS results because of fears that any subdued outlook for next quarter earnings could ignite further selling in the sector going ahead.

Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities Ltd, said, After a negative opening, the Nifty hovered within the range of 17650 -17780. Technically, on daily charts the index has formed a small inside body bearish candle which indicates indecisiveness between bulls and bears. "We are of the view that a 10 day SMA and 17,600 retracement support zone would act as key support levels for the Nifty. Above the same, a strong possibility of a pullback rally up to 17,850-17,900 is not ruled out. On the flip side, below 17,600 range breakout, the market could retest the level of 17,500-17,430."

On the technical front, Nifty has formed a bearish candle but has managed to close above 17,600 levels settled above 21-Days Exponential Moving Averages, said Sumeet Bagadia, Executive Director, Choice Broking. On the weekly Chart, the doji pattern has created some incisiveness among the bulls and bearish. Sustaining 17,500 would be important to continue the ongoing rally. A momentum indicator RSI and MACD indicated slight negative bias. However, Fibonacci retrenchment has support around 17550 levels. Simultaneously, INDIA VIX slipped below 19 can be taken on the positive side. Last three trading day Index has traded in a concise range. Closing above 17,900 or below 17,600 will define a clear trend for the next two remaining days due to the long weekend. At present, the index is having support at 17,500 levels while resistance is placed at 17,800 levels. On the other hand, Bank nifty has support at 36,800 levels while resistance at 38,000 levels, he added.

Indian benchmark indices made a gap down opening and recovered in noon session but not able to sustained due to global cues and closed in red, said Mohit Nigam, Head - PMS, Hem Securities for Monday April 11. IT Major TCS will announce its result post market, and we are expecting flat results.

On the technical front, the key resistance levels for Nifty50 are 17750 and on the downside 17500 can act as strong support. Key resistance and support levels for Bank Nifty are 37,900 and 37,300 respectively.

Rupee settles flat

The rupee pared initial gains to settle almost flat at 75.94 (provisional) against the US dollar on Monday as weak domestic equities negated the impact of easing crude oil prices.

At the interbank foreign exchange market, the rupee opened at 75.94 against the American dollar and oscillated between a high of 75.79 and a low of 76.09 during the session.

The rupee finally settled at 75.94 against the dollar, down 1 paise from the previous close.

On Friday, the rupee appreciated 10 paise to settle at 75.93 against the US dollar.

Global stocks sink on worries over inflation, supply chains

Global stock markets and Wall Street futures sank Monday after the Federal Reserve indicated it might raise interest rates more aggressively to cool US inflation and President Emmanuel Macron emerged from the first round of France's election facing a challenge from the far right, Reuters said.

London and Frankfurt opened lower. Shanghai, Tokyo and Hong Kong retreated. Oil fell more than $2 per barrel on concern global economic growth might weaken.

In early trading, the FTSE 100 in London fell 0.3 percent to 7,648.81 and Frankfurt's DAX shed 0.5 percent to 14,220.99.

The CAC 40 in Paris advanced 0.7 percent to 6,593.24 after Macron said his battle with challenger Marine Le Pen of the National Rally for the April 24 second round of voting will be a hard fight. The two were finalists in the last presidential election five years ago.

On Wall Street, the future for the benchmark S&P 500 index was off 0.4% and that for the Dow Jones Industrial Average was down 0.1%.

On Friday, the S&P 500 lost 0.3 percent and the Dow rose 0.4 percent. The Nasdaq composite fell 1.3 percent.

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Published on: Monday, April 11, 2022, 03:39 PM IST