Budget rally halted by Facebook! Reversal or correction?

Good Morning, Everyone, Nifty took a break from its budget rally mainly with US markets getting weak with not-so-encouraging quarterly results from Facebook. For the first time, the number of users of Facebook declined year on year, and the stock tanked 20%.

This was the exact reason why the IT sectors saw a sharp sell-off yesterday. However, Amazon came with good results yesterday holding up the US market, and hence we can expect the market to take some support today.

As for today, 17500 will act as a support to Nifty, and 17800 will continue to be the major resistance.

The focus will be on steel stocks today as Tata Steel quarterly results are expected.

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Nifty has formed a strong bearish candle on the daily time frame, indicating weakness in the short term.

Global Markets:

A historic plunge in the stock price of Facebook's parent company helped yank other tech stocks lower on Wall Street Thursday, abruptly ending a four-day winning streak for the market. The S&P 500 fell 111.94 points, or 2.4%, to 4,477,44. The Dow Jones Industrial Average dropped 518.17 points, or 1.5%, to 35,111.16. The Nasdaq lost 538.73 points, or 3.7%, to 13,878.82.

The number of Americans filing new claims for unemployment benefits fell more than expected last week as COVID-19 infections subsided, suggesting that an anticipated slowdown in job growth in January was likely temporary.

Initial claims for state unemployment benefits dropped 23,000 to a seasonally adjusted 238,000 for the week ended Jan. 29. Economists polled by Reuters had forecast 245,000 applications for the latest week. Applications fell sharply in Ohio, Kentucky, and Illinois, offsetting notable rises in Michigan, California, Indiana, and Pennsylvania.

The Bank of England raised interest rates to 0.5 percent on Thursday and nearly half its policymakers wanted a bigger increase to contain rampant price pressures, which the British central bank warned would push inflation above 7 percent.

In a surprise split decision, four of the nine Monetary Policy Committee members wanted to raise rates to 0.75 percent in what would have been the biggest increase in borrowing costs since the BoE became operationally independent 25 years ago.

Asia Pacific stocks were mixed on Friday morning, alongside U.S. equity futures. Strong earnings from Amazon.com helped counter a rout in technology shares, while concerns about monetary tightening contributed to market volatility. Japan’s Nikkei 225 edged down 0.11% while South Korea’s KOSPI rose 0.74%.

Oil prices climbed on Friday, extending sharp gains in the previous session sparked by persistent supply concerns and as frigid weather cascades across the United States, threatening to further disrupt fragile oil supplies. Brent crude was up 16 cents, or 0.2%, to $91.27 a barrel by 0102 GMT, after rising $1.16 on Thursday.

Indian Market:

The rupee edged lower by 5 paise to log its third straight session of loss against the US dollar on Thursday as a stronger greenback against key rivals and muted domestic equities weighed on forex market sentiment. It witnessed an intra-day high of 74.75 and a low of 74.92 against the greenback.

Gold prices were trading flat in India on Thursday, on the back of muted global cues. On Multi Commodity Exchange, gold April futures were trading Rs 32 down at Rs 48,052 per 10 gram.

The Reserve Bank of India (RBI) on Thursday cautioned the public not to undertake forex trading on unauthorized Electronic Trading Platforms (ETPs) or remit money against such transactions as these actions attract penalties under the Foreign Exchange Management Act (FEMA).

RBI may hike reverse repo rate in next week's policy | MPC may go for a hike of up to 0.25 percent in the reverse repo rate at which the RBI absorbs excess liquidity and leave the repo rate at which it lends, to narrow the policy rate corridor, a British brokerage said on Thursday.

Results Today:

Tata Steel, Shree Cement, Bank of India, InterGlobe Aviation, One 97 Communications, Siemens, Aditya Birla Fashion, Alkem Laboratories, Devyani International will release their quarterly earnings today.

FII and DII data

Foreign institutional investors (FIIs) net sold shares worth Rs 1,597.54 crore, while domestic institutional investors (DIIs) net offloaded shares worth Rs 370.58 crore in the Indian equity market on February 3

Stock Specific News:

ITC | The conglomerate posted a quarterly net profit at Rs 4,056.73 crore, a 15 percent YoY increase over the Rs 3,526.55 crore reported in Q3FY21, and an over 9 percent QoQ increase over Rs 3,713.76 crore in the previous quarter.

Titan Company | The company reported a standalone net profit of Rs 987 crore for the quarter ended December, beating Street estimates by a wide margin.

Future Retail | The Supreme Court on Thursday refused to pass any interim orders restraining banks from classifying Future Retail as a non-performing asset.

Radico Khaitan | The company reported revenue growth of 12 percent at Rs 766.1 crore in Q3FY22 as against Rs 684.2 crore in Q3FY21.

Adani Power | The company recorded a profit at Rs 218.5 crore in Q3FY22 against a loss of Rs 288.7 crore in Q3FY21, revenue fell to Rs 5,360.9 crore from Rs 6,894.8 crore YoY.

Shree Cement | The company is scheduled to report its Q3FY22 earnings today. Revenues are likely to be higher due to higher realizations on a year-on-year basis. Operating profit is likely to decline by 21 percent at Rs 863 crore, while margins are likely to contract to 25.48 percent.

OnMobile Global | The company partnered with Dialog to launch the first mobile cloud gaming platform in Sri Lanka.

Panacea Biotec | Serum Institute of India sold 3.58 lakh equity shares in the company at Rs 278.15 per share on the NSE, the bulk deals data showed.

India Pesticides | The company reported higher consolidated profit at Rs 43.17 crore in Q3FY22 against Rs 42.08 crore in Q2FY22, revenue jumped to Rs 190.03 crore from Rs 178.47 crore QoQ.

GAIL India | Net profit grew 14.8% at Rs 3,288 crore against Rs 2,863 crore (QoQ). Other income at Rs 651.8 crore against Rs 774 crore (QoQ). Tax expenses at Rs 1,020.4 crore against Rs 819.4 crore (QoQ). Revenue rose 19.8% at Rs 25,769.8 crore against Rs 21,511 crore (QoQ).