WHAT DOES THE SPIKE IN VIX INDICATE?
During the week, the VIX (volatility index) spiked rom 11.53 to 13.46, even touching a high of 14.41 on Friday. VIX is also called the fear index and shows the amount of fear and risk of volatility built in options pricing. Here are the 3 key takeaways.
Overall, the VIX spike shows that the market may have been rather lenient in not factoring the risks and only focusing on the rewards.
EQUITY MARKET TRACKER AGENDA FOR NEXT WEEK
The coming week has some key data points to watch out for. Here are 5 data points that will be closely tracked by the markets in the coming week.
Apart from the above, the markets will also focus on FPI flows, US bond yields and the US dollar index as key inputs.
BSE SENSEX 30 INDEX – SLUMPS BELOW 72,000 IN THE WEEK
The table captures the movement of the BSE SENSEX 30 for the week to April 19, 2024.
Date | Open | High | Low | Close |
19-Apr-24 | 71,999.65 | 73,210.17 | 71,816.46 | 73,088.33 |
18-Apr-24 | 73,183.10 | 73,473.05 | 72,365.67 | 72,488.99 |
17-Apr-24 | 72,892.14 | 73,135.43 | 72,685.03 | 72,943.68 |
16-Apr-24 | 72,892.14 | 73,135.43 | 72,685.03 | 72,943.68 |
15-Apr-24 | 73,315.16 | 73,905.80 | 73,315.16 | 73,399.78 |
12-Apr-24 | 74,889.64 | 74,951.88 | 74,189.31 | 74,244.90 |
Weekly Returns | -1.56% |
Data Source: BSE
After a flat close last week, the Sensex retreated a full 1,157 this week. Sensex touched a high of 74,952, but closed the week at 73,088 levels after the sharp sell-off in the week. On Friday, the Sensex fell below 72,000 but recovered sharply to close above 73,000 for the week. Through this truncated week, the Sensex stayed under 75,000. The rising tide of geopolitical risk and the persistent FPI flows led to the sell-off in markets, even as Q4 results were far from flattering.
NIFTY 50 INDEX – RETREATS FROM LIFETIME HIGHS
The table captures the movement of Nifty 50 index in the week to April 19, 2024.
Date | Low | High | Low | Close |
19-Apr-24 | 21,861.50 | 22,179.55 | 21,777.65 | 22,147.00 |
18-Apr-24 | 22,212.35 | 22,326.50 | 21,961.70 | 21,995.85 |
17-Apr-24 | 22,125.30 | 22,213.75 | 22,079.45 | 22,147.90 |
16-Apr-24 | 22,125.30 | 22,213.75 | 22,079.45 | 22,147.90 |
15-Apr-24 | 22,339.05 | 22,427.45 | 22,259.55 | 22,272.50 |
12-Apr-24 | 22,677.40 | 22,726.45 | 22,503.75 | 22,519.40 |
Weekly Returns | -1.65% |
Data Source: NSE
In the last few weeks, the Nifty has fallen sharply from its all-time high. Nifty closed this week with losses of 372 points, as FPIs net sold $2,229 Million in equities during the week. FPI inflows in the current week more than offset the inflows of last week. In terms of sectoral show; the selling was across the board, although oil & gas managed to show some semblance of sanity. It was the spike in the VIX that was the big story for the Nifty, as risks started to get factored in more effectively.
NIFTY NEXT 50 INDEX – TAKES A DEEPER CUT THAN THE NIFTY
The table captures the movement of Nifty Next 50 for the week to April 19, 2024.
Date | Low | High | Low | Close |
19-Apr-24 | 61,469.45 | 62,051.70 | 60,647.25 | 61,887.90 |
18-Apr-24 | 62,594.55 | 63,033.60 | 61,751.90 | 61,989.20 |
17-Apr-24 | 61,789.80 | 62,331.55 | 61,475.35 | 62,057.50 |
16-Apr-24 | 61,789.80 | 62,331.55 | 61,475.35 | 62,057.50 |
15-Apr-24 | 62,076.25 | 62,716.65 | 61,330.00 | 62,008.15 |
12-Apr-24 | 63,377.30 | 63,735.35 | 62,987.60 | 63,067.85 |
Weekly Returns | -1.87% |
Data Source: NSE
The Nifty Next 50 is the residual list after Nifty 50 stocks are removed from Nifty 100. In a market where Nifty is more about Beta and smaller stocks are about risky alpha, Nifty Next-50 offers the perfect middle path. This week, the index lost -1.87%. The Nifty Next 50 is the list of 50 companies with potential to become Nifty companies in the near future. During the week, Nifty Next-50 touched a high of 63,717 levels but closed at 61,888; largely due to the persistent sell-off in the week. The Next 50 lost 1,180 points during the week.
NIFTY MID-CAP 100 INDEX – WORST PERFORMER AMONG GENERIC INDICES
The table captures the movement of Nifty Mid-Cap 100 in the week to April 19, 2024.
Date | Low | High | Low | Close |
19-Apr-24 | 48,548.40 | 48,913.70 | 47,952.70 | 48,696.95 |
18-Apr-24 | 49,532.00 | 49,731.20 | 48,893.25 | 48,995.70 |
17-Apr-24 | 48,993.35 | 49,550.30 | 48,842.95 | 49,236.65 |
16-Apr-24 | 48,993.35 | 49,550.30 | 48,842.95 | 49,236.65 |
15-Apr-24 | 49,105.00 | 49,644.75 | 48,785.85 | 49,281.00 |
12-Apr-24 | 50,339.20 | 50,590.20 | 50,022.05 | 50,067.55 |
Weekly Returns | -2.74% |
Data Source: NSE
In the last few weeks, the Nifty Mid-Cap 100 did show a bounce from lower levels. However, this week, the Mid-Cap index cracked 274 bps or 1,371 points. This also caps a 4 week rally in the mid-cap index as it closed the week below 49,000, after opening well above the 50,000 mark. Mid-cap stocks tend to be vulnerable to high crude prices and volatility in the USDINR, and that has come back to haunt the mid-cap index in the latest week.
NIFTY SMALL-CAP 100 INDEX – STRESSFUL TIMES FOR SMALL CAPS
The table captures movement of Nifty Small Cap 100 in the week to April 19, 2024.
Date | Low | High | Low | Close |
19-Apr-24 | 16,115.65 | 16,337.00 | 15,928.50 | 16,270.40 |
18-Apr-24 | 16,441.95 | 16,543.55 | 16,250.40 | 16,286.35 |
17-Apr-24 | 16,104.95 | 16,421.65 | 16,065.90 | 16,332.80 |
16-Apr-24 | 16,104.95 | 16,421.65 | 16,065.90 | 16,332.80 |
15-Apr-24 | 16,131.55 | 16,363.30 | 15,911.85 | 16,211.00 |
12-Apr-24 | 16,562.45 | 16,653.30 | 16,473.95 | 16,496.40 |
Weekly Returns | -1.37% |
Data Source: NSE
The small cap index faltered after rallying for 4 weeks in a row. The index had gained 11% in the last 4 weeks, so the -1.37% correction should not really pinch too much. Like the mid-caps, the small caps have also been vulnerable to the crude price volatility. While valuation concerns remain on small cap stocks, the retail interest continues to be in these stocks. Financialization of savings, will be a natural funnel for money flowing into small cap stocks.
BANK NIFTY INDEX – PRESSURE ON HEAVYWEIGHTS
The table below captures the movement of BANKNIFTY in the week to April 19, 2024.
Date | Low | High | Low | Close |
19-Apr-24 | 46,744.95 | 47,668.70 | 46,579.05 | 47,574.15 |
18-Apr-24 | 47,592.70 | 47,829.75 | 46,982.15 | 47,069.45 |
17-Apr-24 | 47,436.70 | 47,609.00 | 47,316.55 | 47,484.80 |
16-Apr-24 | 47,436.70 | 47,609.00 | 47,316.55 | 47,484.80 |
15-Apr-24 | 48,057.50 | 48,255.50 | 47,725.80 | 47,773.25 |
12-Apr-24 | 48,671.20 | 48,882.65 | 48,477.55 | 48,564.55 |
Weekly Returns | -2.04% |
Data Source: NSE
After gains of 3.1% in the previous 2 weeks, the Bank Nifty fell sharply by 2.04% in the latest week to April 19, 2024. Like the Nifty and the Sensex, the Bank Nifty also saw a sharp fall in the week before recovering partially on Friday. The one concern for banks has been the rapid growth in the C/D ratio, which means they may have to offer higher rates on deposits. HDFC Bank results showed flat profits despite ₹7,350 Crore of exceptional gains.
NIFTY IT INDEX – INFOSYS LEADS THE INDEX LOWER THIS WEEK
The table captures the movement of Nifty IT index in the week to April 19, 2024.
Date | Low | High | Low | Close |
19-Apr-24 | 33,047.35 | 33,538.55 | 32,915.50 | 33,368.30 |
18-Apr-24 | 33,746.40 | 34,102.15 | 33,445.35 | 33,498.65 |
17-Apr-24 | 34,108.60 | 34,175.60 | 33,504.35 | 33,574.95 |
16-Apr-24 | 34,108.60 | 34,175.60 | 33,504.35 | 33,574.95 |
15-Apr-24 | 34,845.80 | 35,188.15 | 34,335.15 | 34,463.60 |
12-Apr-24 | 35,222.55 | 35,363.60 | 34,980.85 | 35,018.10 |
Weekly Returns | -4.71% |
Data Source: NSE
The IT index fell sharply by -4.71% after the Infosys Q4 results disappointed. Firstly, the net profit growth came about purely from the tax refund, even as operating margins faltered. In addition, the company lowered its sales growth guidance to 1-3% for the year, putting further pressure on the stock. The concern is that escalation of tensions would mean tech spending also tapering. This sector has been facing tough times since Accenture downsized its revenue guidance, leading to a run on Indian IT stocks.
NIFTY OIL & GAS INDEX – CONTAINED LOSSES DURING THE WEEK
The table captures the Nifty Oil & Gas index for the week to April 19, 2024.
Date | Low | High | Low | Close |
19-Apr-24 | 11,544.55 | 11,667.60 | 11,446.85 | 11,609.85 |
18-Apr-24 | 11,858.55 | 11,996.65 | 11,600.00 | 11,635.30 |
17-Apr-24 | 11,620.20 | 11,888.80 | 11,584.60 | 11,765.30 |
16-Apr-24 | 11,620.20 | 11,888.80 | 11,584.60 | 11,765.30 |
15-Apr-24 | 11,545.35 | 11,839.35 | 11,426.15 | 11,695.15 |
12-Apr-24 | 11,787.75 | 11,818.75 | 11,629.45 | 11,647.75 |
Weekly Returns | -0.33% |
Data Source: NSE
The week saw the oil & gas index closing 33 bps lower as the windfall tax only had a limited impact on the sector. Indian oil companies in the upstream segment gain from higher oil prices as it boosts realization per barrel, improves GRMs and leads to inventory translation at higher levels. There are concerns over oil price volatility in the Brent markets but what should favour oil stocks is that oil prices look all set to remain robust for some time now. The oil prices are not expected to pose a problem as the OPEC is likely to boost supplies of crude oil at higher levels.
NIFTY AUTO INDEX – RATE CUT HOPES IN 2024 REDUCING
The table captures the movement of Nifty Auto index in the week to April 19, 2024.
Date | Low | High | Low | Close |
19-Apr-24 | 21,483.30 | 21,637.10 | 21,144.75 | 21,609.70 |
18-Apr-24 | 21,790.75 | 21,948.50 | 21,459.05 | 21,520.75 |
17-Apr-24 | 21,536.90 | 21,845.10 | 21,480.75 | 21,703.05 |
16-Apr-24 | 21,536.90 | 21,845.10 | 21,480.75 | 21,703.05 |
15-Apr-24 | 21,623.60 | 21,818.85 | 21,445.00 | 21,680.30 |
12-Apr-24 | 21,985.80 | 22,076.20 | 21,834.45 | 21,851.30 |
Weekly Returns | -1.11% |
Data Source: NSE
The Nifty Auto Index had gained 8.2% in last 4 weeks and this week it fell by 111 bps. Even as the US Fed has been ambivalent on rate cuts, the RBI MPC minutes also indicated that any rate cuts look unlikely in India, at least till July this year. However, robust auto demand and the EV shift are likely to be strong stories.
NIFTY FMCG INDEX – TOUGH TIMES CONTINUE
The table captures the movement of Nifty FMCG index in the week to April 19, 2024.
Date | Low | High | Low | Close |
19-Apr-24 | 52,530.00 | 53,229.75 | 52,398.75 | 53,055.45 |
18-Apr-24 | 53,482.90 | 53,571.75 | 52,719.70 | 52,825.50 |
17-Apr-24 | 52,996.55 | 53,526.75 | 52,937.25 | 53,402.25 |
16-Apr-24 | 52,996.55 | 53,526.75 | 52,937.25 | 53,402.25 |
15-Apr-24 | 53,299.05 | 53,475.15 | 52,778.75 | 53,174.95 |
12-Apr-24 | 54,244.45 | 54,275.60 | 53,653.45 | 53,701.40 |
Weekly Returns | -1.20% |
Data Source: NSE
The FMCG sector has seen persistent pressure in recent week. In the latest week, the FMCG index lost another 120 bps. Even as the FMCG sector remains a good defensive play and consumption proxy; there are concerns too. Weak rural demand is not reviving in a hurry and higher crude prices are pushing up input costs. FMCG may not be in the best of times!
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