Trade Setup: Top 15 things to know before market opens on May 4, 2022

On the back of poor global signals ahead of the FOMC meeting, Indian equities markets recovered most of their early losses and closed flat on Monday. Markets began lower as traders were concerned that government data indicated that growth in eight main infrastructure industries slowed to 4.3% in March, down from 12.6% the previous year, owing to a fall in coal and crude oil output.

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The Nifty50 has formed a long bull candle on the daily chart, indicating rangebound action at the support zone of 16,900 where reasonable buying has emerged in the past, according to Nagaraj Shetti, Technical Research Analyst at HDFC Securities.

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Shetti sees the possibility of another round of bounce in the short term. However, long-term charts remain weak and a lack of strength to sustain the bounce could eventually lead to a decisive move to 17,000-16,800 levels in the near term, he warns.

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Indian Indices

Sensex fell 84.88 points or 0.15% to 56,975.99 and Nifty was down by 33.45 points or 0.20% to 17,069.10 in the previous session. Sensex touched a high and low of 57,054.23 and 56,412.62, respectively. There were 11 stocks advancing against 19 stocks declining on the index. Nifty traded in a range of 17,092.25 and 16,917.25. There were 18 stocks advancing against 31 stocks declining, while 1 stock remained unchanged on the index.

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Broader Indices

The broader indices ended in red with the BSE Midcap index falling 0.47%, while the Small cap index was down by 0.87%. The gaining sectoral indices on the BSE were Metal up by 0.77%, Basic Materials up by 0.28%, Utilities up by 0.26%, Power up by 0.22% and Realty up by 0.19%, while Consumer Durables down by 2.37%, Telecom down by 1.68%, IT down by 1.47%, Auto down by 1.19% and TECK down by 1.17% were the top losing indices on BSE.

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India VIX Index

Nifty or India VIX, a gauge of the market’s expectation of volatility over the near term, rose 4.47% to 20.28 on Monday.

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SGX Nifty

The trends on SGX Nifty indicate a positive opening for the index in India with a 13-points gain. The Nifty futures were trading at 17,058.20 on the Singaporean Exchange around 06:40 hours IST.

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Support and Resistance levels

The key support level for the Nifty is placed at 16,960, followed by 16,851. If the index moves up, the key resistance levels to watch out for are 17,135 and 17,201, according to pivot charts.

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US Markets

The S&P 500 rose 20.10 points, or 0.5%, to 4,175.48.

The Dow Jones Industrial Average rose 67.29 points, or 0.2%, to 33,128.79.

The Nasdaq rose 27.74 points, or 0.2%, to 12,563.76.

The Russell 2000 index of smaller companies rose 15.94 points, or 0.8%, to 1,898.86.

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Asian Markets

Asian markets finished mixed on Tuesday. The Shanghai Composite gained 2.42%, while the Nikkei 225 led the Hang Seng lower. They fell 0.11% and 0.07% respectively.

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European Markets

European markets finished higher yesterday with shares in France leading the region. The CAC 40 was up 0.79% while Germany’s DAX was up 0.72% and London’s FTSE 100 was up 0.22%.

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Major News Headlines

Tata Steel Q4 results: Net profit jumps 37% YoY to Rs 9,835 crore

Tata Steel reported a 37% rise in consolidated net profit at Rs 9,835.12 for the quarter ended March 2022. The company had reported a net profit of Rs 7,161.91 crore in the March 2021 quarter. India’s largest steelmaker posted a 39% year-on-year (YoY) growth in consolidated revenue at Rs 69,323.50 crore during the March 2022 quarter from Rs 50,300.55 crore in the same quarter of fiscal 2021. Tata Steel India’s revenue rose 34% YoY to Rs 36,681 crore and Tata Steel Europe posted a 53% growth at Rs 25,389 crore in the same quarter.  The company board has recommended a dividend of Rs 51 per share. The company has also declared a proportionate dividend of Rs 12.76 per equity share or 510% for the partly paid-up ordinary shares of the company. The firm also announced a stock split at 10:1. The equity shares of the company having a face value of Rs 10 each will be divided into 10 equity shares of Re 1 each. In December 2021 quarter, the steelmaker reported a net profit of Rs 9,572.67 crore with revenue from operations at Rs 60,783.11 crore.

AGEL gets nod for Rs 3,850 crore investment by Green Energy Investment Holding RSC

Adani Green Energy has received shareholders’ approval for the issuance of over two crore shares worth around Rs 3,850 crore on a preferential basis to Green Energy Investment Holding RSC Ltd. The current major shareholder of Green Energy Investment Holding RSC Ltd is IHC Capital Holding LLC. At the extraordinary general meeting (EGM) held on May 3, shareholders approved the issuance of equity shares on a preferential basis to Green Energy Investment Holding RSC Ltd, according to a regulatory filing. In a separate filing, the company stated it has signed a share subscription agreement (SSA) on Monday with Green Energy Investment Holding RSC Ltd for the issuance and allotment of 2,00,18,198 equity shares of the face value of Rs 10 each of the company to the investor on preferential basis. The equity shares will be issued at a price of Rs 1,923.25 each (at a premium of Rs 1,913.25 per equity share), the filing said. The total issue size will be worth around Rs 3,850 crore.

Electricity giant NTPC rushes back to coal as India’s energy crisis worsens

The state-run electricity giant NTPC Limited plans to expand its coal-fired power fleet with the first new project in six years, a policy shift that shows alarm over the nation’s worsening power crises. NTPC is all set to call bids for three such plants to meet the soaring demand for electricity. This month, the company will award a contract to construct a 1,320-megawatt coal-fired plant supercritical plant in Talchar, Odisha, reported Bloomberg. The company may also consider awarding contracts for two previously blocked expansion projects at its Lara and Singrauli sites in central India. According to a Bloomberg report, despite the short-term addition to its coal fleet, NTPC will stick to a target to rapidly expand clean energy capacity. The company is looking to reduce the share of fossil fuels in its energy mix to about half by 2032 from 83% at present.

Adani Wilmar acquires rice brand Kohinoor to strengthen market position

Adani Wilmar Limited (AWL) announced the acquisition of renowned Basmati rice brand- Kohinoor for the India region from McCormick Switzerland GMBH for an undisclosed amount. The acquisition will give Adani Wilmar exclusive rights over the brand ‘Kohinoor’ Basmati rice along with ‘Ready to Cook’, ‘Ready to Eat’ curries and meals portfolio under the Kohinoor Brand umbrella in India. The Kohinoor brand portfolio includes Kohinoor – for premium Basmati rice, Charminar – for affordable rice and Trophy for hotels, restaurants, and catering (HORECA) segment. All three brands already have a sale of Rs 300 crore a year, the company said. “The addition of Kohinoor’s domestic brand portfolio strengthens Adani Wilmar’s leadership position in the food FMCG category by augmenting a strong product basket with the premium brand along with the potential to scale value-added products,” Adani Wilmar said in a stock exchange filing. “It also leverages the reach of Kohinoor brand to drive synergies for AWL across geographies and complements the reach of its flagship brand ‘Fortune’ in the food FMCG domain,” it added.

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Bulk Deal data

GAURAV JAIN sold 1,50,000 shares in Debock Industries Limited at Rs 116.83 per share on the NSE.  

JAKSH FINANCIALS PRIVATE LIMITED sold 3,02,273 shares in DRC Systems India Limited at Rs 45.29 per share on the NSE.

ISHARES CORE TOTAL INTERNATIONAL STOCK MAURITIUS CO sold 13,33,741 shares in Escorts India Limited at Rs 1580.75 per share on the NSE. 

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VISTRA ITCL INDIA LIMITED sold 133,73,596 shares in Future Consumer Limited at Rs 2.42 per share on the NSE.  

IDBI TRUSTEESHIP SERVICES LTD sold 12,84,935 shares in Future Mkt Networks Limited at Rs 5.90 per share on the NSE.

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SHIKHAR SINGH bought 27,869 shares in Hisar Metal Ind. Limited at Rs 138.87 per share on the NSE. 

PRISMX GLOBAL VENTURES LIMITED sold 1,80,000 shares in Empyrean Cashews Limited at Rs 128.60 per share on the NSE.  

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BAISIWALA SAMEER AJAY sold 88,615 shares in McDowell Holdings Limited at Rs 76.14 per share on the NSE.

SHANI BHATI sold 3,50,000 shares in Vaxtex Cotfab Limited at Rs 26.84 per share on the NSE. 

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VINEETA SINGH bought 24,000 shares in Walpar Nutritions Limited at Rs 38.92 per share on the NSE.  

COPTHALL MAURITIUS INVESTMENT LIMITED sold 45,00,000 shares in Zee Learn Limited at Rs 7.34 per share on the NSE.

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DII and FII data

Foreign institutional investors (FIIs) sold shares worth a net Rs 1853.46 crore, while domestic institutional investors (DIIs) bought shares worth a net Rs 1951.1 crore in the Indian equity market on May 2, according to the data available on the NSE.

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NSE F&O Ban

No stock/security has been put under the F&O ban for May 4. Securities in the ban period under the F&O segment include companies in which the security has crossed 95% of the market-wide position limit.