Zubu Client Sentiment Nifty50 Report & Market Recap (Jul-21-2022)
Zubu Client Sentiment Nifty50 Report:
It is a Post Market Analysis, by which one can understand Retail trader’s sentiment and discover who was going long and short, the percentage change over time, and whether market signals are bullish or bearish
Nifty50 retail trader data shows 57.50% of traders are net-long, while the number of traders net-short was 42.50%. FII’s unwinded huge shorts -11200 & created huge longs 17451, while retailers created huge shorts 20379 & few longs 2687.
Nifty50: 16,605 ▲ 84 (+0.5%) Sensex: 55,681 ▲ 284 (+0.5%)
Markets reversed early losses to close higher for the fifth consecutive day. In all, 42 of the Nifty50 stocks closed in the green. The European Central Bank raised interest rates by 50 basis points for the first time in 11 years.
Among the Nifty sectoral indices, PSU Bank (+1.6%) and Media (+1.1%) saw the most gains, whereas Pharma (-0.4%) was the sole loser.
Top gainers Today’s change
IndusInd Bank 950 ▲ 71 (+8.1%)
Bajaj Finance 6,274 ▲ 199 (+3.2%)
TATA Consumer 818 ▲ 23 (+2.9%)
Top losers Today’s change
Dr Reddy’s 4,374▼ 84 (-1.9%)
SBI Life 1,170 ▼ 16 (-1.3%)
Kotak Mahindra Bank 1,805 ▼ 22 (-1.2%)
⭐ Gold loses shine 🥇
International gold prices declined to their lowest level since August 2021. The weakness in gold prices could be attributed to the rise in the US Dollar index, which is up nearly 12% so far in 2022. The dollar index measures the value of the US Dollar relative to a basket of foreign currencies. Generally, a rising dollar index makes gold expensive in terms of other currencies and thus impacts its demand. Further, rising interest rates also makes gold unattractive compared to interest-bearing assets such as bonds.
⭐ ITC surges to three-year high 📈
ITC (NSE): 299 ▲ 1.2 (+0.4%)
Shares of ITC hit a fresh 52-week high intraday on Thursday. The company management said that it is open to restructuring its business, including the demerger of its hotel business and the listing of its subsidiary ITC Infotech in the future. It also said that it is focusing more on exports of its FMCG products.
⭐Tata Communications rallies on profit boost 📡
TATACOMM (NSE): 1,082 ▲ 103 (+10.5%)
Shares of Tata Communications rallied as the company’s consolidated net profit jumped nearly 84% year-on-year (YoY) at ₹544 crore in Q1 FY23. Its consolidated revenue stood at ₹4,311 crore, up 5% YoY. The Data Services segment was the largest contributor to the company’s business, with revenues of ₹3,353 crore. The management said profit growth was driven by increase in customer engagements and their portfolio enhancements.
⭐ Gland Pharma slumps after weak results 💊
GLAND (NSE): 2,342 ▼ 131 (-5.3%)
Shares of the Hyderabad-based pharma company plummeted 10% intraday on Thursday to hit a 52-week low after poor Q1 results. The company reported a 35% year-on-year (YoY) drop in its Q1 net profit to ₹229 crore. Profits were impacted by continued supply disruptions and rising costs. The company’s revenue from operations declined 26% YoY to ₹857 crore. It said revenues were higher last year due sales of to Covid-related products.
⭐ Zydus BP drug gets approval 💉
ZYDUSLIFE (NSE): 355 ▼ 3.8 (-1.0%)
Zydus Lifesciences got an approval from the US health regulator USFDA to market norepinephrine bitartrate injection. It is used for treatment of extremely low blood pressure in adult patients. The drug will be manufactured at the group’s topical injectable manufacturing facility at Gujarat. Norepinephrine bitartrate injection had annual sales of $63.8 million in the US.
Investors hungry for FMCG stocks
FMCG stocks have been on investors’ shopping lists this month. The Nifty FMCG index has risen over 12% in July alone! But considering the soaring retail inflation, how come the sector’s been doing so well? Let’s unpack this.
A major boost this month has come from the monsoons. After irregular rains in June, July has witnessed heavy rains that have drenched many parts of the country. Historically, good monsoons are known to boost rural demand. But how?
The rains are timely as this is the peak season for sowing of kharif crops. Healthy rains during this period boost farmers’ incomes. This increases their disposable income, which results in better demand for FMCG companies.
Besides this, FMCG companies are able to pass on the rise in commodity prices more comfortably as compared to other sectors. This is because most FMCG products are considered daily necessities, which are less sensitive to price hikes.
Another major reason the investors are munching on FMCG stocks is the fall in the prices of palm oil. Earlier this week, Indonesia—which is a major producer of palm oil—removed the ban on palm oil exports (until 31 August). This is a major boost for this segment, as palm oil is a major ingredient in many FMCG products.
While FMCG stocks have left investors’ mouths watering, will they sustain their appetite? That’s a worry for another day. Right now, the feast is on.