Trade Setup: Top 15 things to know before market opens on January 31, 2022

On Friday, Indian equity indices erased all gains and finished flat with a negative bias, owing to a late sell-off in Banking, Auto, and Finance stocks. The benchmark indices opened fairly positive and remained in the green for the majority of the day, as traders took spirit from the commerce ministry’s announcement that India’s electronic goods exports increased by 49% to $11 billion from April to December 2021, compared to $7.4 billion in the same period last year.

The Nifty50 has formed a reasonable negative candle on the daily chart with a long upper shadow, suggesting an inability of the market to sustain the highs, according to Nagaraj Shetti, Technical Research Analyst at HDFC Securities.

“After a sustainable upside recovery from significant lower support of the ascending trend line around 16,850-16,900 levels recently, the Nifty showing weak upside bounce is not a good sign,” he said.

Indian Indices

Sensex fell 76.71 points or 0.13% to 57,200.23 and Nifty was down by 8.20 points or 0.05% to 17,101.95 in the previous session. Sensex touched high and low of 58,084.33 and 57,119.28, respectively. There were 14 stocks advancing against 16 stocks declining on the index while Nifty traded in a range of 17,373.50 and 17,077.10 and there were 31 stocks advancing against 19 stocks declining on the index.

Broader Indices

The broader indices ended in green with the BSE Midcap index rising 1.02%, while the Small cap index was up by 1.07%. The top gaining sectoral indices on the BSE were Healthcare up by 1.10%, Basic Materials up by 0.90%, IT up by 0.88%, Telecom up by 0.87%, TECK up by 0.78% while, Bankex down by 0.75%, Auto down by 0.64%, Finance down by 0.29%, Capital Goods down by 0.14% and Consumer Durables down by 0.11% were the top losing indices on BSE.

Support and Resistance levels

Key support levels for the Nifty are placed at 16,994.83, followed by 16,887.77. If the index moves up, the key resistance levels to watch out for are 17,291.23 and 17,480.57, according to pivot charts.

SGX Nifty

The trends on SGX Nifty indicate a positive opening for the index in India with a 108-points gain. The Nifty futures were trading at 17,225.80 on the Singaporean Exchange around 06:42 hours IST.

Asian Markets

Asian markets finished mixed. The Nikkei 225 gained 2.09%, while the Hang Seng led the Shanghai Composite lower. They fell 1.05% and 0.97% respectively.

US Markets

The S&P 500 rose 105.34 points, or 2.4%, to 4,431.85.

The Dow Jones Industrial Average rose 564.69 points, or 1.7%, to 34,725.47.

The Nasdaq rose 417.79 points, or 3.1%, to 13,770.57.

The Russell 2000 index of smaller companies rose 37.22 points, or 1.9%, to 1,968.51.

European Markets

European markets finished broadly lower on Friday with shares in Germany leading the region. The DAX was down 1.32% while London’s FTSE 100 was off 1.11% and France’s CAC 40 was lower by 0.82%.

Saregama India aims to invest up to Rs 750 crore in the music biz

Saregama India, a part of RP-Sanjiv Goenka Group, is planning to invest up to Rs 750 crore in its music business to achieve a 25-30% revenue growth in the next few years through organic and inorganic routes, an official said. It is also foraying into a new business segment of artiste partner programme to launch their music videos and audios on its platforms with an arrangement of sharing revenue, he told analysts. The fund (of up to Rs 750 crore) is only for the music business. This is not going to be used for our films or our Carvaan business. Other businesses are well capitalised and they will be able to manage to run on their own…. Our projection of 25-30 per cent revenue growth that we are giving is a combination of both organic, new content purchases, and some inorganic purchases,” the official said.

FPIs pulls Rs 28,243 crore from Indian stocks as US Fed signals rate hike

Foreign portfolio investors (FPIs) pulled out a whopping Rs 28,243 crore from Indian equities in January as US Fed signalled an interest rate hike. As per the depositories data, FPIs took out Rs 28,243 crore from equities between January 3-28. During the same period, they pumped Rs 2,210 crore into the debt segment and Rs 1,696 crore into hybrid instruments. The total net outflow stood at Rs 24,337 crore. The total net outflow stood at Rs 24,337 crore. With the latest pull out of funds from Indian markets, FPIs have become net sellers for the fourth consecutive month.

By October, NTPC plans to set up a new green energy arm for monetization

NTPC Ltd will form a new subsidiary for some identified renewable energy projects with the aim to monetise it by October, the company’s management told investors in a conference call on January 29. The power utility is scaling up its investment in renewable energy portfolio by investing in it 40-45% of its capital expenditure in financial year (FY) 2022, and FY23. “Today our board has decided that certain identified solar energy assets will be transferred to a separate special purpose vehicle or a subsidiary, for which we will be seeking an exemption from the Government of India from capital gains tax. As soon as that is available, we will be monetising it, most probably by October 2022,” said AK Gautam, director (finance). On January 29, NTPC reported a consolidated profit of Rs 4,626.11 crore in the December 2021 quarter, up from Rs 3,876.36 crore in the corresponding period of the previous fiscal. The consolidated total income was Rs 33,783.62 crore in Q3FY22 as against Rs 28,387.27 crore a year ago.

Hinduja Global Solutions acquire Australian enterprise Diversify

Hinduja Global Solutions Ltd (HGS) has announced that its subsidiary, HGS International Mauritius, has entered into a definitive agreement to acquire a 100% equity stake in Diversify Offshore Staffing Solutions Pty Ltd (Diversify), Australia. The transaction is expected to close within the next few days. With the acquisition of Diversify, HGS will open up New Zealand (ANZ) as a new market, with the addition of clients from that region. It will also supplement its portfolio in the US. While most of its current offshore footprint is in the Philippines, this will open up the gates for ANZ offshoring to HGS’ Indian operations. It bolsters HGS’ portfolio of back-office and non-voice businesses in domains like Digital Marketing, Finance & Accounts, IT services, etc.

Hero Electric is in discussions with investors about selling a stake in the company as the struggle for brand ownership heats up

Hero Electric, the country’s biggest manufacturer of electric two-wheelers, is talking to investors to raise funds for expanding business multiple times over amid an ongoing tussle with Hero MotoCorp to ringfence the Hero brand. From a level of around 130,000 a year, Hero Electric is looking to move to 5 million units of capacity a year in the next 24 months. To achieve this, it forged a partnership with the Mahindra Group this month to use their plant in Pithampur, Madhya Pradesh for an initial capacity of 200,000-250,000 units a year. “We are not growing 40-50 per cent, we are growing multiple times. For instance, we are doubling our volumes this year over the previous year and next year we will be tripling over this year and that’s the bare minimum. So, when we are pushing each segment of our business, like sales, R&D, new factories, there is a constant need for capital. We raised capital last year, now again there is a need for another raise,” Naveen Munjal, Managing Director, Hero Electric, told BusinessLine.

Bulk Deal data

PUSHPENDER JAIN sold 70,000 shares of Dynamic Srvcs & Sec Ltd at Rs 31.65 per share on NSE.

MCAP INDIA FUND LIMITED sold 5,50,000 shares in Ganesha Ecosphere Limited at Rs 585.00 per share on the NSE.

RAJASTHAN GLOBAL SECURITIES PVT LTD bought 66,045 equity shares in Brand Concepts Limited at Rs 70.21 per share on the NSE, the bulk deals data showed.

ALPHA LEON ENTERPRISES LLP picked up 1,15,000 equity shares in Mittal Life Style Limited at Rs 18.25 per share on the NSE.

MANSI SHARES & STOCK ADVISORS PVT LTD bought 1,61,113 shares in Sanco Industries Ltd. at Rs 12.40 per share on the NSE.

BNP ENTERPRISES sold 3,19,000 equity shares in Lasa Supergenerics Ltd at Rs 69.56 per share on NSE.

DII and FII data

Foreign institutional investors (FIIs) sold shares worth a net Rs 5,045.34 crore, while domestic institutional investors (DIIs) bought shares worth a net Rs 3,358.67 crore in the Indian equity market on January 28, as per provisional data available on the NSE.

NSE F&O Ban

No security/stock has been put under the F&O ban for January 31. 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.