Nifty above 16,200 level, profit booking in metal stocks

The headline equity indices continued to trade in a narrow range with modest gains in the early afternoon trade. The Nifty was trading a tad above the 16,200 level. Metal stocks witnessed profit booking after gaining in the past three sessions.

At 12:30 IST, the barometer index, the S&P BSE Sensex, was up 244.69 points or 0.45% to 54,423.15. The Nifty 50 index added 68.45 points or 0.42% to 16,201.35.

In the broader market, the S&P BSE Mid-Cap index shed 0.12% while the S&P BSE Small-Cap index gained 0.35%.

The market breadth was positive. On the BSE, 1,838 shares rose and 1,289 shares fell. A total of 167 shares were unchanged.

Derivatives:

The NSE's India VIX, a gauge of the market's expectation of volatility over the near term, drop 1.93% to 18.83. The Nifty 28 July 2022 futures were trading at 16,197, at a discount of 4.35 points compared with the spot at 16,201.35.

The Nifty option chain for the 28 July 2022 expiry showed maximum Call OI of 23.8 lakh contracts at the 16,500 strike price. Maximum Put OI of 37.1 lakh contracts was seen at 15,000 strike price.

Buzzing Index:

The Nifty Metal index declined 0.50% to 4,817.90. The index saw profit booking after rising 3.61% in the past three trading sessions.

Jindal Steel & Power (down 1.57%), Vedanta (down 1.45%), Steel Authority of India (down 1.44%), Tata Steel (down 1.36%), Welspun Corp (down 1.27%), JSW Steel (down 0.91%), Jindal Stainless (down 0.77%), Hindustan Copper (down 0.71%), Ratnamani Metals & Tubes (down 0.65%) and Adani Enterprises (down 0.3%), edged lower.

On the other hand, Hindustan Zinc (up 1.83%), Hindalco Industries (up 0.48%) and APL Apollo Tubes (up 0.31%) advanced.

Vedanta fell 1.45%. The mining company said that it will acquire Athena Chhattisgarh Power located in Jhanjgir Champa, Chhattisgarh for Rs 564.67 crore. The acquisition is estimated to be completed in FY 2023.

Stocks in Spotlight:

Mahindra & Mahindra (M&M) rose 1.09% after the auto major said that British International Investment (BII) will invest upto Rs 1,925 crore at a valuation of up to Rs 70,070 crore, into M&M's new 4 wheel passenger EV arm. BII to invest up to Rs 1,925 crore in the form of compulsory convertible instruments at a valuation of up to Rs 70,070 crore. This will result in 2.75% to 4.76% ownership for BII in the EV Co. The EV Co. will focus on four-wheel (4W) passenger electric vehicles. It is expected that the first round of BII's capital investment will be completed not later than June 2023 on fulfilment of conditions precedent and the balance post completion of certain milestones in FY24.

Tata Motors rose 0.59% after its subsidiary Jaguar Land Rover (JLR) recorded a 37% drop in retail sales to 78,825 units in Q1 FY23 over Q1 FY22. Retail sales for the quarter were broadly flat compared with the previous quarter ending 31 March 2022. Despite a record order book, sales continue to be constrained by the global chip shortage, compounded by the run out of the prior model Range Rover Sport, with deliveries just starting, and the impact of Covid lockdowns in China, the company stated.

Jaguar reported retail sales of 15,207 units in Q1 FY23, dropping 48% from Q1 FY22 and recording an increase of 4% over Q4 FY22. Land Rover reported 33% decline in retail sales to 63,618 units in Q1 FY23 over Q1 FY22 and 1% fall as compared with Q4 FY22.

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