On Monday, domestic stock markets experienced a severe drop as the S&P BSE Sensex fell over 1,100 points in morning trade, eventually sliding 1,300 points to 78,420, while the NSE Nifty50 declined by 428 points to 23,876 at 11:00 am. We could see selling to support levels for NSE Nifty but if the indices close below major support levels, we can expect further selling. The sentiment in the markets is strongly bearish today and we might see sell on rallies even if there is a recovery during the week.
Broader Impact: The sell-off impacted midcap and smallcap indices as well, reflecting widespread investor unease driven by foreign outflows and both global and domestic economic concerns.

Record Foreign Outflows Intensify Market Weakness

FPI Sell-Off: Foreign portfolio investors (FPIs) sold a record-breaking Rs 1,13,858 crore in October, marking the highest monthly outflow to date and adding pressure to Indian markets.
Impact on Benchmarks: The relentless FPI exit has led to an approximate 8% decline in benchmark indices from recent highs, exacerbated by high valuations and subdued earnings prospects.

Weak Q2 Earnings Deepen Investor Concerns

Major Downgrades: Q2 results led to significant downgrades in FY25 EPS projections for key stocks like BPCL, IndusInd Bank, and UltraTech Cement, with BPCL’s forecast seeing the steepest cut at 34.3%.
Broader Earnings Pressure: While 34 Nifty stocks posted a modest 5% sales growth, EBITDA rose only 1%, and net profit growth stalled, signaling weaker corporate earnings and casting doubt on current market valuations.
Mahindra Unveils New Electric Brands Ahead of November Premiere

Launch of Mahindra’s XEV and BE Electric Brands

Upcoming Launch: Mahindra will introduce two pioneering electric vehicle brands, XEV and BE, based on its Electric Origin INGLO architecture, on November 26, 2024, at the Unlimit India World Premiere in Chennai.
Market Anticipation: This launch positions Mahindra to capture growing demand in India’s EV market, leveraging its advanced platform.
Niva Bupa Health Insurance IPO Set with Price Band of Rs 70-74

Niva Bupa Health Prepares for IPO

Price Band: Niva Bupa Health Insurance Company has set a price range of Rs 70-74 per share for its IPO, opening to subscribers on November 7.
IPO Timeline: The anchor book opens on November 6, with the issue closing on November 11. Allotments will be finalized on November 12, and shares will debut on exchanges on November 14.
US Presidential Election Raises Market Volatility

Market Jitters from Upcoming U.S. Election

Potential Impact: With the U.S. presidential election set for November 5, markets globally are bracing for potential volatility. Analysts expect a short-term rally if Trump wins, though its longevity is uncertain, while a Democratic win may prompt a near-term correction.
Indian Market Outlook: Emkay Global suggests that a 5% correction could create buying opportunities in Indian equities, with a stable medium-term outlook regardless of the election outcome.
Oil Price Surge Increases Inflation Concerns for India

Crude Prices Rise Amid Middle Eastern Tensions

Price Spike: Crude oil prices surged by 2% on Monday to $74 per barrel as OPEC+ delayed a planned production hike, stoking concerns about global supply, especially as tensions escalate between Israel and Iran.
Domestic Impact: Rising oil prices pose risks for India, a major importer, potentially worsening inflation and impacting economic stability.
Rupee Nears All-Time Low, Intensifying Foreign Exchange Concerns

Rupee Weakens Against Dollar, Heightening FPI Outflow Risks

Currency Pressure: The rupee is approaching its record low of 84.1 against the dollar, with analysts warning that further depreciation could drive additional FPI outflows.
Inflationary Risks: A weaker rupee may increase import costs, particularly for energy, putting additional strain on India’s foreign exchange reserves and potentially inflating domestic prices.
Nomura Maintains 'Neutral' on Sun Pharma with Target Price of Rs 1,850

US Court Blocks Sun Pharma's Launch of Leqselvi

Injunction Granted: The New Jersey district court issued a preliminary injunction against Sun Pharma, blocking the launch of its Leqselvi product, approved by the US FDA in July 2024 for Alopecia Areata.
Projected Revenues Impacted: Sun Pharma had forecasted revenue contributions of USD 10 million in FY25, USD 80 million in FY26, and USD 150 million in FY27 from Leqselvi, which may now be delayed due to legal challenges.

Video and Image Courtesy, Faisal Khan YouTube Channel