January 24th 2024 Stock Market analysis

Robust Intraday Recovery Propels Market to 1% Gains; Mid and Small Caps Shine Bright

Indian benchmark indices halted a two-day losing streak and recouped some of the losses from previous sessions, closing higher in volatile trading on January 24. The Sensex recorded a gain of 689.76 points, or 0.98 percent, finishing at 71,060, while the Nifty rose by 215.15 points, or 1.01 percent, to reach 21,454. Despite a fluctuating performance throughout the session, the market ultimately concluded near its daily peak, propelled by a surge in buying during the final hour of trading.

In the NSE Nifty, notable gains were witnessed among the top performers, led by Hindalco, which traded at 566.75, marking an impressive 4.68% increase. Dr. Reddy's Laboratories also showcased robust performance, reaching 5891 with a substantial 3.82% surge. IndusInd Bank contributed to the positive momentum, trading at 1495.45 and reflecting a notable 3.73% uptick. These bullish movements underscored the resilience and strength in these particular stocks, highlighting the optimism and buying interest prevailing in the market for these entities.

On the flip side, certain stocks experienced declines, with ICICI Bank leading the pack of top losers as it traded at 998.3, reflecting a notable -2.99% decrease. Axis Bank also faced a downturn, trading at 1059.6 with a -2.72% decline. Asian Paints witnessed a decrease as well, trading at 3001.95 and marking a -1.73% dip. These contrasting performances among the top gainers and losers reflect the dynamic nature of the market, influenced by various factors including company-specific news, broader economic trends, and investor sentiments.

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Technical outlook on 25th January 2024

The Nifty exhibited a noteworthy pattern as it breached yesterday's low but managed to close above the 21270 levels in both hourly and daily candles. This suggests the possibility of short covering, with an anticipated upward move towards the 21630 ranges. For intraday trading, Nifty is likely to find immediate support around 21281, followed by 21109, while resistances are expected at 21539 and 21625. The current market scenario for Nifty suggests a mixed trade, with potential fluctuations.

In the case of Bank Nifty, there is an immediate support expected around 44833, followed by 44584, and resistances are projected at 45331 and 45580. Similar to Nifty, Bank Nifty is also indicating a mixed trade, indicating potential uncertainty and variability in the market trends.

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Derivative Outlook on 25th January 2024

PCR Analysis: Nifty PCR-OI has increased with nifty has positive close which shows PUT WRITING.

Open Interest Analysis: Nifty future JAN contract OI has decreased with positive close which shows Short Covering.

Cost of Carry Analysis: Nifty JAN month contract has ended in high compare with FEB contract and  high range compare with previous session which indicates a profit booking from higher levels.

India VIX Analysis: India VIX has closed at 14.38 vs 14.85 (DoD) basis which shows decrease in volatility.

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Indian Bank Reports Robust Q3 Performance with a 51.8% Surge in Net Profit, Reaching Rs 2,119.35 Crore

Indian Bank, a state-owned institution, reported an impressive 51.84% surge in net profit, reaching Rs 2,119.35 crore in the third quarter of the financial year 2023-24. The notable increase, observed sequentially at 6.6%, can be attributed to enhanced asset quality and a rise in fee-based income. The bank's commitment to managing non-performing assets (NPAs) is evident, with gross NPAs standing at 4.47% as of December 31, 2023, reflecting a significant improvement from 4.97% in the last quarter and 6.53% a year ago. Additionally, the company's net NPAs demonstrated a positive trend, settling at 0.53%, down from 0.60% in the last quarter and 1% in the previous year. With a provision coverage ratio of 95.90% (excluding technical write-off), Indian Bank underscores its commitment to prudent financial management.

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Deposit & Advances

In the latest quarter, the state-owned lender witnessed a robust 10% YoY increase in its total deposits, reaching Rs 6.54 lakh crore, with a 2% quarterly growth. Among these deposits, the bank held Rs 6.29 lakh crore in domestic deposits and Rs 24,753 crore in overseas deposits. The yearly analysis reveals an 8% growth in domestic deposits and an impressive 89% surge in overseas deposits.

The bank's focus on Current Account Savings Account (CASA) deposits proved successful, with an 8% annual growth, while savings deposits and current deposits expanded by 7% and 12%, respectively. The domestic CASA ratio stood at a robust 41.14%. Concurrently, the state-owned lender's advances saw a substantial 13% YoY growth, reaching Rs 5.1 lakh crore in the October-December quarter.

Within the retail, agriculture, and MSME (RAM) segment, advances demonstrated a noteworthy 13% year-on-year increase, totaling Rs 2.97 lakh crore. The RAM segment contributed significantly, accounting for 62.58% of the gross domestic advances. Specifically, Home Loan (including mortgage) experienced a 12% year-on-year growth, Auto Loan surged by an impressive 46%, and Personal Loan recorded a substantial 30% year-on-year increase. The Priority Sector portfolio stood at Rs 1.72 lakh crore in the third quarter of the current financial year, underscoring the bank's diverse and dynamic lending portfolio."

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