Tale of the Tape 

Hiya ya’ll. Markets were volatile AF!

Nifty and Sensex cracked sharply in the second half of the trading session to end -0.5% lower each. Weakness in heavyweight large caps and rising fears of a global recession dented sentiment. Midcaps (-0.2%) and Smallcaps (-0.8%) also followed suit. The advance-decline ratio was in favour of the bears (4:1).

Except FMCG (+0.3%), all sectors ended in the red. Oil & Gas (-1.9%) and PSU Banks (-1.8%) were the top losers.

Tata Motors was the top Nifty loser and is on its longest losing streak in 16 years. Read our top story to find out what’s wrong?

The Nifty Pharma Index is the best performing sector in 2024. More details below on how to play this sector.

Oil India, Ramco Systems and Samvardhana Motherson all saw big movements today. Check out their charts below to find out why.

Suzlon Energy was locked in a +5% upper circuit for a second day. PS - Morgan Stanley is overweight and it recently won India’s biggest-ever wind turbine order from NTPC Green Energy.

Jubilant Pharmova hit an all-time high after its Washington facility received the clean chit from the USFDA.

Arvind Fashions (+1%) was in focus after 56.2 lakh shares (4.2% equity) changed hands in a block deal; the buyers and sellers were not immediately known.

Infibeam Avenues cracked -4% after the stock traded ex-date for the spin-off of its digital marketing arm.

Bharat Electronics (+1%) bagged multiple orders worth Rs 1,155 cr.

Here are the closing prints:

Stock
Just A Speed Bump Or Dead End?

Tata Motors (-5%) was the top Nifty loser today following a series of bad news. PS - the stock has been on an INSANE run since 2021. Has it started to hit a speed bump or is it a dead end? Let’s take a look. 

Firstly, UBS reiterated its bearish stance and said it sees a -15% downside from current levels! FYI -the brokerage has raised red flags over slowing global demand for Jaguar Land Rover’s premium models, higher discounts and sees margin pressure going forward.

There are two problems with global demand. The first is the China problem. The country’s economy is slowing down and hurting luxury car sales for many companies. FYI - BMW also slashed its 2024 guidance today, citing muted demand and weak consumer sentiment. This is a huge headache for JLR too: while its FY24 retail sales were up +22% YoY, its China market sales were down -9% YoY. North America and the UK can prop up the biz for only so long, especially since the US has its own problems now.

The second issue is the EV slowdown. Sales have hit a plateau in many markets. Last month, JLR announced that it was spending £3 billion to revamp its ICE & hybrid models as demand for EVs grew less than anticipated. This could cause a lot of short-term problems.

Back home, the situation isn’t great either. Tata Motors just announced discounts of up to Rs 2 lakh on a number of models to deal with MASSIVE UNSOLD INVENTORY. PS - the firm reported a -8% YoY volume decline for August 2024. This doesn’t mean all is lost. A lot depends on how the upcoming festive season goes, how long it will take China to bounce back and how the EV vs hybrid war plays out both at home and globally. Watch this space!

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