Sensex Soars to Record Highs: Banking, Auto Stocks Shine While IT Lags Behind

On September 23, 2024, Indian markets saw a surge, with both the Sensex and Nifty reaching record highs in early trade. The rally was fueled by a wave of optimism following the Federal Reserve's rate cut last week, sparking a positive sentiment among investors. This reduction in interest rates has reignited a "risk-on" approach in the markets, driving investments in riskier assets such as equities.

Key Indices Movement:

• The Sensex rose by 384.30 points, or 0.45%, closing at 84,928.61.
• The Nifty 50 climbed 148.05 points, or 0.57%, to end at 25,939.00.

The market breadth was positive, with 2,273 shares advancing, 1,661 shares declining, and 119 shares remaining unchanged. The upward momentum was primarily driven by gains in banking, energy, and auto stocks, while the IT sector lagged behind.

Key Movers on September 23:

1. Indus Towers:
   CMP: ₹402 | Gain: 4%
   Shares of Indus Towers surged by 4% after CITI issued a 'Buy' recommendation on the stock with a target price of ₹500 per share. Although the Supreme Court's dismissal of the AGR petition was a headline, it was not expected to impact Vodafone Idea's cash flows immediately. However, the long-term sentiment surrounding the stock might be influenced by Vodafone Idea's future performance.

2. Adani Total Gas:
   CMP: ₹829 | Gain: 5%
   The stock jumped by over 5% after Adani Total Gas secured a $375 million financing package from global lenders. This marks the largest-ever global funding initiative in the City Gas Distribution (CGD) sector. The joint venture between the Adani Group and TotalEnergies of France secured these funds to boost its CGD business in India.

3. SpiceJet:
   CMP: ₹70 | Gain: 5%
   Shares of SpiceJet soared over 5% after the airline raised ₹3,000 crore through the issuance of shares to Qualified Institutional Buyers (QIBs). The capital infusion provided a much-needed financial boost to the struggling low-cost airline.

4. Hind Rectifiers:
   CMP: ₹856 | Gain: 5%
   Hind Rectifiers hit the upper circuit with a 5% rise after securing a ₹200 crore supply order from Indian Railways. This contract is set to be executed by FY26, driving long-term growth for the company.

5. Fusion Micro Finance:
   CMP: ₹275 | Loss: 10%
   The stock of Fusion Micro Finance plummeted over 10% after Investec downgraded its rating to 'Sell' from 'Hold'. The downgrade was attributed to the company's increased provisioning for Estimated Credit Loss (ECL) for Q2 of FY25 compared to the first quarter, indicating a more conservative outlook on potential defaults.

6. Aarti Drugs:
   CMP: ₹526 | Gain: 1%
   Aarti Drugs saw a modest gain of 1%, despite the US FDA issuing Form 483 with seven observations for its API manufacturing facility in Tarapur, Maharashtra. None of the observations were related to data integrity, which reassured investors to some extent.

7. Glenmark Pharma:
   CMP: ₹1,705 | Gain: 5%
   Glenmark Pharma shares jumped 5% after its Aurangabad manufacturing facility cleared a routine US FDA inspection without any observations, a significant achievement in maintaining quality standards.

8. Vodafone Idea:
   CMP: ₹11 | Gain: 4%
   Vodafone Idea shares gained 4% after the telecom operator signed a $3.6 billion (₹30,000 crore) deal with Nokia, Ericsson, and Samsung to supply network equipment over the next three years. This strategic partnership is expected to boost its 5G rollout across India.

9. Skipper:
   CMP: ₹478 | Gain: 15%
   Shares of Skipper surged 15% after Axis Securities initiated coverage with a 'Buy' rating and set a price target of ₹600 per share. The domestic brokerage sees 44% upside potential due to robust growth prospects in the company.

10. Nifty IT:
    Loss: 0.5%
    The Nifty IT sector was the only sectoral index in the red, falling by 0.5%. Major IT companies like Infosys, Tech Mahindra, and TCS dragged the index down. After substantial gains in previous months (12% in June, 13% in July, and 5% in August), the sector has been undergoing profit booking in September, resulting in a cumulative 2% decline so far this month.

Conclusion:
The stock market on September 23 saw a strong uptrend driven by sectors like banking, energy, and auto. However, IT stocks underperformed amid profit booking. Key movers like Indus Towers, Adani Total Gas, and SpiceJet led the gainers' list, while Fusion Micro Finance experienced a sharp decline due to a downgrade by Investec. The market sentiment remains buoyed by macroeconomic factors like the Federal Reserve's rate cut, which has strengthened investor optimism.

Wol 3D India
Rappid Valves
Manba Finance
SD Retail Logo
Avi Ansh Textile
Phoenix Overseas
Kalana Ispat
Saj Hotels