The surge in crude oil prices could disrupt the Indian market in the short term. Brent crude crossed the $90 mark, the most since October, and was trading 0.47% higher at $91.08 a barrel.
Further, Dabur India Ltd.'s fourth quarter results do not inspire confidence for FMCG bottom-fishing.
The continued selling by foreign investors suggests a limited upside to the rally in the short term, according to Aditya Arora, founder and multi-asset research analyst at Adlytick.in.
Foreign investors have offloaded equities worth Rs 4,971 crore in the last three sessions, Arora noted. "This pattern indicates distribution in the cash market, suggesting a limited upside to the ongoing broad-based rally in the short term."
A breakthrough above 22,700 for Nifty 50 on a closing basis could signal a technical upside towards levels of 22,790–23,000, Arora said.
Taking these data points into consideration, there appears to be limited upside potential for Friday's session, with substantial downside risk looming for bullish traders, he cautioned. "However, this scenario presents an opportunity for bearish positions," he said.
All eyes will also be on the Reserve Bank of India's monetary policy meeting outcome and its impact on rate-sensitive stocks like auto, real-estate and banking.
Mid-cap stocks have shown more buoyancy than small and micro-caps, which are witnessing a counter-trend bounce, according to Jai Bala of CashTheChaos.
"Markets have managed to cross the 3% (growth) mark since the start of the year, and every new high is getting pushed back to the previous range," the chief market technician told NDTV Profit on Thursday. "That's not a positive sign."
Most chemical makers will witness sequential recovery in the top line and bottom line and share positive commentary after results, according to Rohan Gupta, director at Nuvama Institutional Equities.
The GIFT Nifty, an early indicator of the Nifty 50 index's performance in India, was trading 19 points, or 0.08%, lower at 22,551.5 as of 7:28 a.m.
FII And DII Activity
Overseas investors remained net sellers of Indian equities for the fourth consecutive session on Thursday.
Foreign portfolio investors offloaded stocks worth Rs 1,136.5 crore, while domestic institutional investors turned net sellers and sold equities worth Rs 893.1 crore, the NSE data showed.
Markets On Thursday
The benchmark equity indices snapped a two-day losing streak to close at a record high on Thursday amid gains in global markets after US Federal Reserve Chair Jerome Powell restored hopes of rate cuts this year.
The NSE Nifty 50 closed 80 points or 0.36% higher at 22,514.65 and the S&P BSE Sensex gained 350.81 points or 0.47% to end at 74,227.63. Intraday, the Nifty rose as much as 0.82% to 22,619 points and the Sensex 0.85% to 74,501.73.
The broader markets ended on a mixed note. The BSE MidCap settled 0.11% lower and the BSE SmallCap ended 0.54% higher.
On the BSE, 13 sectors advanced and seven sectors declined, with the Information Technology index rising nearly 1% to emerge as the top performer. Oil & Gas declined over 1% to become the top loser.
Major Stocks In News
Bajaj Finance: The company reported AUM at Rs 3.3 lakh crore, up 34% YoY, in the fourth quarter, while deposits stood at Rs 60,100 crore, up 35%.
UltraTech Cement: The company has completed a 100 MW solar energy project under the Group captive scheme in Rajasthan. The company now has a capacity of 612 MW of renewable power and 278 MW of WHRS.
Nestle India: The National Consumer Dispute Redressal Commission dismissed a complaint filed by the Dept. of Consumer Affairs on MAGGI Noodles in 2015.
Top Brokerage Call
Citi On Bata
The brokerage reiterates 'sell' with a target price of Rs 1,000 per share.
It expects that the Q4 FY24 earnings may disappoint consumer discretionary and retail companies.
It expects Bata India to report 2% year-on-year revenue growth.
Expects Ebitda margin of 23.5%.
FY25/FY26 EPS estimates are below their estimates.
Citi On Page Industries
The brokerage reiterate 'sell' with a target price of Rs 31,300 per share.
Demand trend continues to remain muted and competitive intensity remaining elevated.
FY25 and FY26 EPS estimates are below consensus estimates.
For Q4FY24, Citi expects 6% revenue growth and 20% Ebitda margin.
Citi on Dabur
Reiterates 'sell' rating and revised their target price to Rs 500 per share from Rs 520 apiece earlier.
It expects Q4 FY24 trading update points to a weaker-than-expected performance.
Profitability is also below expectations they estimate Ebitda grew over 8% year-on-year.
Believes Q4 profitability was impacted by an inferior category mix.
Estimate Q4 salience of food and beverage segment in the domestic business has increased to 22-23%.
Forecasts over 6% consolidated revenue growth year-on-year to Rs 2830 crore.
Expects gross margin to expand over 120 bps year-on-year.
Forecasts Ebitda to grow over 8% year-on-year to Rs 440 crore.
Global Cues
Shares in the Asia-Pacific region fell during early trade on Friday taking cues from overnight losses in the Wall Street as geopolitical tensions flared up.
The KOSPI was trading 0.51% lower at 2,718, and the S&P ASX 200 was trading 0.48% lower at 7,779.5 as of 6:34 a.m.
The U.S. stocks tanked amid a rally in oil as geopolitical tensions triggered a flight to the safest corners of the market, Bloomberg reported. The S&P 500 index and the Dow Jones Industrial Average fell 1.23% and 1.36%, respectively, as of Thursday. The Nasdaq Composite ended 1.40% lower.
Brent crude crossed the $90 mark, the most since October and was trading 0.47% higher at $91.08 a barrel. Gold was lower by 0.44% at $2,280.84 an ounce.
Rupee Update
The Indian rupee ended at a new closing low against the dollar on Thursday on oil importers dollar demand and a surge in the greenback.
The local currency depreciated two paise to close at Rs 83.45 against the dollar. It had closed at Rs 83.43 a dollar on Wednesday, according to Bloomberg data.
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