Monday mayhem

Nifty50: 15,863▼ 382 (-2.3%)

Sensex: 52,842▼ 1,491 (-2.7%)

• The markets opened with a huge gap down and traded sideways as investors remained jittery about the Russia-Ukraine conflict and rising crude oil prices.
• In all, 38 stocks of the Nifty50 pack ended in the red.
• The rupee nearly touched the ₹77 per dollar mark. FIIs pulled out close to ₹18,600 crore in just the last three trading sessions.
• The exit-poll results of the UP assembly elections are expected later today, which could have an impact on the markets.

Among the Nifty sectoral indices, Realty (-5.4%) and Bank (-4.7%) were the top losers, while Metal (+2.1%) was the sole gainer.

For more updates on F&O, click here.

Here are the top stories of the day.

ONGC hits 52-week high in a weak market

The shares of state-owned oil explorer and producer ONGC rallied on the back of surging crude oil prices in an otherwise weak market. This development also comes at a time when the US and European allies are considering a ban on Russian oil imports, while delays in the potential return of Iranian crude to global markets fueled supply fears.

Sustained higher crude oil prices and gas realisations can boost the profitability for ONGC. In the current financial year, the share price of ONGC has risen nearly 83%, significantly outperforming the Nifty50, which has gained merely 8% in the same period.  

JK Cement to enter paint business

JK Cement will be foraying into the paint business through a wholly-owned subsidiary. The board of the company has approved an investment of ₹600 crore over a five-year period. The wholly-owned subsidiary will undertake manufacturing, selling, trading, importing, exporting and dealing in all types of paints and allied products and services.

In the recent past, Aditya Birla Group announced its entry into the paint business via its unit Grasim Industries. Further JSW Steel had also announced that it will enter the paint business with an investment of ₹750 crore in tranches by FY25.

Rising energy costs pinch steel companies

As the conflict between Russia and Ukraine escalated, energy prices soared with the Brent crude surging past $130 a barrel. Freight rates of cargo ships, which currently stand at $20,000 a day, are likely to reach $30,000 per day, impacting the cost of raw materials.

India reportedly meets 85% of its coking coal requirement from imports, the prices of which have risen to $550 per tonne, from $250 per tonne before the crisis began. Iron ore prices have also gone up to ₹10,000 per tonne lump, a key raw material for steel manufacturing. Experts believe all these factors will together have an impact on the production cost of steel.

IPO Corner

With the financial year coming to a close, the IPO market in India is likely to witness a number of companies going public. The first of which may be LIC, the most awaited IPO of the year. Amid all the news surrounding it, the government may come out with the IPO later this month and is expected to raise around ₹70,000 to 75,000 crore. Next, Byjus, the learning app, is planning to launch its IPO soon. The company expects to raise $400 million to $600 million through its public issue. And last, Pharmeasy, the medicine-delivery app, is also planning to launch its IPO this month. The company expects to raise at least ₹6,250 crore by issuing fresh shares.

Good to know

What is the Black Monday?

Black Monday occured on 19 October, 1987 when the Dow Jones Industrial Average (DJIA) fell 22% in a single day. Economists attributed the crash to a combination of geopolitical events and the advent of computerised program trading, which can move massive volume in just milliseconds, resulting in increased volatility that accelerated the selloff. The event triggered a global market decline with most major exchanges dropping nearly 20% by the end of the month.

Click here to join us on Telegram for trading and investment-related videos, daily market updates, details on upcoming IPOs and more.

Yay 👍 or Nay 👎?

We'd love your thoughts on this market recap.

Haven't tried out Upstox yet? Click here to open your account now!