" US Inflation &TCS Q2 Results " Nifty & Bank Nifty, Pre Market Report, Analysis 11 Oct 2024, Range.

Summary

This video provides a pre-market report for October 11, 2024, focusing on key events such as US inflation data and TCS Q2 results. The US consumer inflation for September leaned slightly negative, impacting the market sentiment with a gap-down opening for S&P 500. TCS missed analyst expectations in terms of profit and revenue, which negatively influenced Indian IT stocks. Other major insights include institutional trading activities and technical analysis of Nifty and Bank Nifty. The video offers market forecasts, highlighting crucial support and resistance levels, alongside important global economic data releases.

Takeaways

• 📉 The US consumer inflation data for September was mixed, slightly leaning towards the negative side (10-20%) despite market attempts to interpret it as neutral.
• 📊 Core inflation (excluding food and fuel) increased by 3.3% year-on-year, 1% higher than expected, indicating that core inflation remains a concern for the US Federal Reserve.
• 📉 Overall US inflation dropped slightly from 2.5% in August to 2.4% in September, largely due to declines in food and fuel prices.
• 💡 The next key US inflation data (PCE inflation) is set to be released on October 31, followed by the Fed's interest rate decision on November 7.
• 📉 US stock markets (Dow Jones, S&P 500, and NASDAQ) saw declines after the inflation report, with the Dow Jones down 0.4%, S&P 500 down 0.21%, and NASDAQ down marginally by 0.4%.
• 📊 TCS Q2 results missed analyst expectations on both profit and EBIT margins, with attrition rates increasing to 12.3% from 12.1% in the previous quarter.
• 📉 Negative market reactions were observed as a result of TCS's poor results, with ADRs of Infosys and Wipro down by around 2.5%.
• 📈 HDFC Bank saw positive market reactions due to an increase in foreign shareholders’ holdings, which rose from 47% to 48%.
• 📊 FIIs (Foreign Institutional Investors) continued their selling spree for the ninth consecutive session, selling ₹4,930 crores, while DIIs (Domestic Institutional Investors) were net buyers for the 13th straight session, purchasing ₹3,880 crores.
• 📊 Gift Nifty indicates a 60-80 point gap down opening today due to weak sentiments from US inflation data and TCS's disappointing earnings.

Q & A

What was the impact of the US consumer inflation data released on October 11th, 2024?

The US consumer inflation data for September 2024 was slightly negative, as core inflation increased by 1% more than expected. Despite this, the market tried to interpret the data as neutral, with short-term fluctuations expected.

Why is core inflation considered more important than overall inflation for the US Fed's decisions?

Core inflation excludes volatile components like food and fuel, making it a more stable indicator for monetary policy decisions. The Fed prefers to focus on core inflation to avoid the unpredictable fluctuations caused by food and energy prices.

How did the US stock market react to the September 2024 inflation data?

The US stock market initially opened lower due to the inflation data, with S&P 500 opening gap down. However, there was a short recovery during the day before another sell-off occurred, leading to a slight overall negative outcome.

What were the key takeaways from TCS’s Q2 results?

TCS's Q2 results for FY2025 missed analyst expectations. Revenue growth was 2.6% (close to estimates), but profit growth was only 1.1%, well below the 4.9% expected. EBIT margins also fell short, indicating overall disappointing performance.

How did the stock market react to TCS’s Q2 results?

Following the release of TCS’s Q2 results, both Infosys and Wipro saw their ADRs drop by about 2.5%, signaling a negative market reaction to the disappointing earnings.

What is the significance of the foreign shareholder increase in HDFC Bank?

HDFC Bank's Q2 report showed an increase in foreign shareholder holdings from 47% to 48%. This was perceived positively by the market, contributing to an increase in the bank's stock price.

What is the outlook for the Indian market based on the US inflation and TCS results?

Given the mixed US inflation data and TCS’s disappointing Q2 results, the Indian market is expected to open 60-80 points lower, indicating a cautious outlook with potential volatility in the short term.

What is the role of FIA and DII in the current market trend?

FIAs (Foreign Institutional Investors) have been net sellers for the ninth consecutive session, while DIIs (Domestic Institutional Investors) have been net buyers for 13 straight sessions, indicating a divergence in sentiment between foreign and domestic investors.

Which stocks showed signs of short build-up and long build-up in the market?

Stocks like Cement, SunTV, L&T, ACC, and City Union Bank showed short build-up, while Reliance Industries, NTPC, ITC, and Motherson displayed signs of long build-up, indicating differing market sentiments for these stocks.

What are the key technical levels to watch for Nifty and Bank Nifty?

For Nifty, the critical resistance level is at 25,035 to 25,500, with support around 24,750. Bank Nifty’s resistance zone is 51,700 to 52,000, with support near 51,000. Both indices need to break these levels for further directional movement.