June 4th 2024 Stock Market analysis

Indian Equities Plunge as Ruling Party Struggles to Secure Majority

Indian indices plunged on Tuesday as voting trends indicated results were falling short of the exit polls. Both the BSE Sensex and NSE Nifty 50 experienced their biggest single-day drop in four years, driven by trends showing that the incumbent Bharatiya Janata Party was struggling to secure a clear majority. This unexpected outcome of the Lok Sabha polls triggered panic selling across the board, raising concerns about political stability and policy continuity. By the close, the Sensex had plummeted 4,389.73 points, or 5.7%, to 72,079.05, while the Nifty 50 had slumped 1,379.40 points, or 5.9%, to 21,884.50. Adani Ports & Special Economic Zone led the decliners, with shares falling 21%, followed by Adani Enterprises and Oil & Natural Gas Corp. In contrast, Hindustan Unilever, Nestle India, and Britannia Industries emerged as the top gainers.

‍Technical Outlook on 5th June

Nifty may expect an immediate support near 21370 then 20896 and resistances are 22358 then 22832. Now the nifty is looking at a negative bias with high volatility trade ahead.

Bank Nifty may expect an immediate support near 45781 then 44634 and resistances are  48075 then 49222. Now the bank nifty is looking at a negative bias with high volatility trade ahead.

Derivative Outlook on 5th June

PCR Analysis: Nifty PCR-OI has decreased with nifty has negative which shows CALL WRITING.

Open Interest Analysis: Nifty future June contract OI has increased with negative close which shows Short Buildup.

Cost of Carry Analysis: Nifty June month contract has ended in low compare with July contract and low range compare with previous session which indicates a negative bias.

India VIX Analysis: India VIX has closed at 26.75 vs 20.94 (DoD) basis which shows increased in volatility.‍

ONGC, Indian Oil, Adani Total Gas Plummet as Investors Cash Out; Nifty Oil & Gas Drops 5%‍

Oil and Gas stocks plunged on June 4 as investors rushed to book profits following a sharp rally in the previous session. The Nifty Oil & Gas index slipped over 5 percent in early trade, with losses led by Adani Total Gas, which nosedived over 10 percent. Shares of ONGC, Gail India, and other PSUs in the sector, including HPCL, Indian Oil, and BPCL, also fell by up to 7 percent due to profit-taking. The Nifty Oil & Gas index had surged over 6 percent in the previous session after exit polls hinted at a decisive victory for the BJP-led NDA with over 350 seats. However, as early leads showed the NDA coalition's majority might not be as emphatic as forecasted by the exit polls, the Sensex and Nifty 50 dropped more than 4 percent, erasing nearly Rs 25 lakh crore from BSE market capitalization.