Index trend and stocks in action on March 30, 2020

Nifty started off the last week by registering one of the most severe falls in the history as on Monday, Nifty plunged almost 13 per cent but thereafter, the momentum changed its course and Nifty rallied sharply on the hopes of stimulus packages from the centre and short covering. It rallied as much as 20 per cent from the lower levels, however, the momentum fizzled out on the day when RBI came out with its boldest announcements to combat Coronavirus pandemic with big bang rate cut and EMIs put on hold. This made it a perfect example of ‘buy on rumors and sell on news’. Finally, Nifty closed the week with a loss of 85 points or 0.97 per cent.

Even after rallying 20 per cent from the bottom in just four trading days, Nifty failed to close above 23.6 per cent retracement level. Further, it also failed to close prior bar’s high on a weekly basis. As we have mentioned in our previous write-ups, bear market rallies are sharp that are destined to fizzle out later.

With Nifty failing to cross 23.6 per cent retracement levels and the daily range of Nifty cooling down to about 500 points (from 800 points), with this contraction of range, the Bollinger Bands have also just started narrowing on the lower time frame. Going ahead, the high to low range of the last week becomes crucial, which stands at 7,511 to 9,039 levels. As long as we stay within this range, we can expect the markets to consolidate.

Overall, we recommend approaching the coming week on a highly cautious note without getting too excited about the counter-trend rallies.  

Sun Pharmaceutical: The company has received a communication from USFDA indicating that Halol facility has been classified under official action indicated (OAI). The OAI classification implies interalia that USFDA may withhold the approval of any pending product applications or supplements filed from this facility till the outstanding observations are resolved.

Motherson Sumi systems: Moody’s Investors Service has assigned Ba1 corporate family rating (CFR) to Motherson Sumi Systems. Further, the outlook has been revised to rating under review from negative.

Manappuram Finance: Fitch has placed the 'BB long-term issuer default ratings (IDR) of Manappuram Finance Limited (MFIN) on rating watch negative (RWN).

NTPC: NTPC completes the acquisition of stake from Government of India in NEEPCO and THDC.

Delta Corp: The board of directors at the company meeting approved a proposal to buyback up to 1.25 crore shares of the company, representing 4.61 per cent of the total paid-up capital of the company, at a price note exceeding Rs 100 per shares.

Lupin: Lupin & Mylan announced that European Medicines Agency’s committee for medicinal products for human use having adopted a positive opinion and recommended the approval of Nepexto®, a biosimilar to Enbrel® (Etanercept).

Laurus Labs: Rising Pharmaceuticals & Laurus Labs partnered to support University of Minnesota to explore the prophylaxis effect of Hydroxychloroquine in essential health care workers.