Market status: Downtrend

Global stock markets: Dow30, -0.4%; S&P 500, -0.5%; Nasdaq, -1%; Nikkei, -1.8%; Kospi, +0.3%

Yesterday, Nifty gapped down at the open by more than 300 points. It breached its April 12 low (12,248) and made a new low of 14,192. Buying was seen at the day’s low, which helped Nifty close above 14,350. On the sectoral front, Nifty Bank, Auto, and Fin Services closed 2–3% lower. On the flip side, Nifty Pharma closed in the green.

We had changed the market status to a Rally Attempt from a Downtrend on Friday after Nifty managed to hold above the previous correction low (14,248) for three consecutive days. But yesterday, as Nifty breached that low, we are back in a Downtrend. Looking forward, we will shift the market to a Rally Attempt if Nifty establishes a bottom and stays above yesterday’s low (14,192) for three straight sessions. From there, we would prefer to see a follow-through day before shifting the market back to a Confirmed Uptrend. Should this occur, the focus will be on ideas breaking out of early-stage base patterns and showing the best relative strength with good accumulation.

Nestle India and TV18 Broadcast will declare Q4 FY21 results today.

Acc declared its Q4 FY21 results, which beat consensus on all fronts. PAT grew 74.2% y/y to Rs 563 crore, while revenue grew 22.7% y/y to Rs 4,213 crore. EBITDA was up 46.8% y/y to Rs 860 crore, resulting in a 330bps y/y margin expansion.

Icici Prudential Life Insurance declared its Q4 FY21 results. PAT fell 65% y/y to Rs 62.51 crore, while net premium income grew 13.4% y/y to Rs 11,880 crore.

O’Neil Market Condition Report

For the 24 emerging markets tracked by our institutional research team, the market status breakdown is as follows: Confirmed Uptrend, 30%; Rally Attempt, 12%; Uptrend Under Pressure, 52%; Downtrend, 6%.

For the 24 developed markets tracked by our institutional research team, the market status breakdown is as follows: Confirmed Uptrend, 65%; Rally Attempt, 10%; Uptrend Under Pressure, 25%; Downtrend, 0%.

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