March 1st 2024 Stock Market analysis

‍Sensex and Nifty Reach New Highs on Strong GDP Data; Nifty Bank Crosses 47,000 Mark

Indian equity benchmarks, the Sensex and the Nifty, reached fresh record highs on March 1, buoyed by better-than-expected GDP data, improved auto sales numbers, and in-line US inflation figures, which kept hopes of a rate cut alive. The latest quarterly GDP growth rate, the highest in six quarters, stood at 8.4 percent in the December quarter, according to data released by the Ministry of Statistics and Programme Implementation on February 29. This growth rate marks the fastest expansion since the first quarter of 2022-23, when the economy grew by 13.1 percent. The Nifty kicked off the March series on a positive note, extending gains throughout the day and reaching a record high by crossing 22,300 for the first time. 

At the close, the Sensex surged by 1,245.05 points, or 1.72 percent, to reach 73,745.35, while the Nifty climbed 356.00 points, or 1.62 percent, to hit 22,338.80, marking their best closing levels to date. Over the week, the Sensex gained 0.8 percent, and the Nifty added 0.5 percent. Despite weaker core sector data for January and a widened fiscal deficit of Rs 11.03 lakh crore over 15 months, the market remained largely unfazed. Notable Nifty gainers included Tata Steel, L&T, JSW Steel, Titan Company, and IndusInd Bank, while Dr Reddy's Laboratories, Sun Pharma, HCL Technologies, Infosys, and Britannia Industries were among the losers.

Technical Outlook on 4th March

Nifty is likely to find immediate support levels near 22,262 followed by 22,186, with resistances anticipated at 22,414 and 22,490. Currently, profit booking is expected at higher levels for Nifty.

Similarly, Bank Nifty is expected to encounter immediate support near 47,001 and 46,724, while resistances are seen at 47,567 and 47,848. Profit booking is anticipated in Bank Nifty at present levels.

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Derivative Outlook on 4th March

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

Open Interest Analysis: Nifty future March contract OI has decreased with positive close which shows Long Unwinding.

Cost of Carry Analysis: Nifty MARCH month contract has ended in low compare with Apr contract and low range compare with previous session which indicates a mild profit booking.

India VIX Analysis: India VIX has closed at 15.24 vs 15.57 (DoD) basis which shows decrease in volatility.

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ICICI Bank Surges to 52-Week High Following Stake Increase in ICICI Lombard

Shares of ICICI Bank surged 3 percent to reach a 52-week high of Rs 1,085.3 on March 1, following the private lender's increased stake in ICICI Lombard General Insurance through a second open market transaction within a week. This move came shortly after the bank purchased a 1.6 percent stake in the issuer for Rs 1,356 crore. At 3:30 pm, the stock was trading at Rs 1,086.90 on the National Stock Exchange (NSE), marking a 3.30 % increase. Year-to-date, the stock has surged by 8 percent, outpacing the 2 percent decline in the Bank Nifty index over the same period. On February 29, ICICI Bank acquired an additional 25.14 lakh shares in ICICI Lombard General Insurance for Rs 431 crore, following the announcement of the acquisition of close to 81 lakh shares in ICICI Lombard for Rs 1,356 crore. With this latest share acquisition, ICICI Lombard has officially become a subsidiary of the bank, as per regulatory filings. This development follows a May 2023 resolution by the bank’s board to increase the bank’s holding in ICICI Lombard by another 4 percent in multiple tranches, after obtaining approvals from banking and insurance regulatory authorities. Conversely, shares of ICICI Lombard declined by 2 percent to Rs 1,670 on March 1, despite having surged over 17 percent year-to-date and reaching a 52-week high of Rs 1,739 on February 28, 2024.