Sensex, Nifty open higher; Adani stocks bleed; SBI, Titan, IndusInd Bank rally up to 5%

Domestic equity markets opened higher on Friday, bucking the mixed global cues. However, US stocks were mostly up in the overnight trade, supporting the headline peers. However, Adani Group stocks remained under pressure over the negative news flow.

At 9.20 am, the 30-share pack BSE Sensex jumped 406.11 points, or 0.68 per cent, at 60,338.35, whereas NSE' Nifty50 rallied 90.20 points, or 0.51 per cent, at 17,700.60. Broader markets underperformed headline peers as BSE midcap and smallcap indices were marginally up. Fear gauge India VIX eased another 3 per cent to 15.34-level.

"The Nifty formed a small bull candle confined within last session’s trading range, indicating pause in downward momentum while intraday pull backs were short lived," said ICICIDirect.

"Going ahead, prolonged consolidation in the range of 18000-17300 above 200 days EMA would result in a base formation at key supports while absorbing Fed event and concerns about banking NPAs. In the process, stock specific action would prevail amid progression of earning season," it said.

Most of the sectors were trading higher on Friday. Nifty PSU Index led the gainers with a 2 per cent rally, whereas private bank and financial services indices jumped over a per cent each. Auto index also posted strong gains. Metal index tanked over a per cent, whereas pharma and IT stocks were also lower.

There was no relief for Adani Group stocks. Adani Enterprises plunged 15 per cent, whereas Adani Ports tumbled over 9 per cent in the early session. In the cash market, all stocks hit their respective lower circuits. Adani Transmission and Adani Green plunged 10 per cent each. Adani Total Gas, Adani Power and Adani Wilmar were down 5 per cent each.

On the Nifty50 index, Titan Company surged 5 per cent after strong Q3 performance and positive management commentary. IndusInd Bank jumped 4 per cent as promoters gets nod to increase their shareholding in the private lender. SBI jumped 3 per cent ahead of Q3 earnings later in the day. Bajaj Finserv and SBI Life were up 3 per cent each.

Barring the Adani Group stocks, Divis Labs dropped 4 per cent. Bharat Petroleum, Power Grid, HDFC Life Insurance, Tech Mahindra, Tata Consumers and Nestle were other top losers with each falling a per cent each.

The most significant trend in the market so far in 2023 is the big underperformance of India compared to other markets. India’s relative overvaluation is the fundamental reason for this underperformance triggered mainly by the sustained selling by FIIs, which continued yesterday also, said V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

"The ‘Adani stocks crisis’ also has contributed to the negative sentiments. Investors may wait and watch for the dust to settle. The Adani crisis impact is slowly diminishing," he added. "IT stocks look strong. High quality private sector banking stocks and capital goods stocks also are on strong wicket."

In the broader market, investors cheered the strong earnings by Karnataka Bank as stock jumped 10 per cent, whereas Man Infra was up 8 per cent. Gulf Oil Lubricants, Aegis Logistics and Jubilant Industries jumped 5-7 per cent each during the early trade.

On the downside, Hindustan Construction Company plunged over 12 per cent after a flop show in December 2022 quarter. Monarch Networth Capital, Crompton Greaves and SH Kelkar soared 6-9 per cent each. Stove Kraft and Timex were down 5 per cent each.

 

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