Markets closed lower compared to yesterday’s closing point.
Pharma stocks and metal stocks fell the most today. Media stocks and consumer durables stocks rose the most.
Global markets: US markets rose on Thursday. Most Asian markets traded mixed on Friday. Most European markets rose (as of 6 pm IST).
News
India’s forex reserves rose $14.14 billion to $707 billion for the week ended on 7 August.
India’s wholesale price inflation fell to 9.78% year-on-year in July compared to 9.87% in June.
Shiprocket IPO was subscribed 99.38 times on day 3. Retail subscription: 46.42 times. IPO closed for subscription.
LEAP India listed at Rs 165.90 on NSE, a premium of 4.34% over its issue price and closed 8.18% lower.
Zetwerk filed an updated DRHP for an IPO, consisting of a fresh issue of Rs 2,600 crore and an Offer For Sale of 9.68 crore shares.
Stocks Updates
Reliance: announced plans to partner with Rolls-Royce to jointly develop and manufacture an indigenous combat engine for India’s AMCA program. They will also explore setting up an Aerospace Gas Turbine Complex in India.
ICICI Bank: completed the issuance of $300 million by issuing bonds through its IFSC Banking Unit. The issue is part of its $7.5 billion Global Medium Term Note program.
Adani Enterprises: Subsidiaries acquired Path Highways LLP for Rs 91.34 crore, increasing their effective stake in Mancherial Repallewada Road Ltd, Suryapet Khammam Road Ltd and Bilaspur Pathrapali Road Ltd to 99.99%.
Tata Steel: agreed to sell its entire stake in Jamshedpur Football and Sporting Pvt Ltd to Churchill Brothers Sports Club Pvt Ltd for a nominal Rs 100. The subsidiary contributed only 0.01% of Tata Steel’s FY26 consolidated turnover.
Adani Energy Solutions: acquired 100% stake in Vizag Power Transmission Ltd from REC Power Development and Consultancy Ltd.
Bank of Baroda: issued $700 million of senior unsecured fixed-rate bonds. This includes $400 million of three-year bonds at a 5.114% coupon and $300 million of five-year bonds at a 5.318% coupon.
Vedanta: was declared the successful bidder for the 152-hectare Punnam Manganese Block in Andhra Pradesh. The block is currently at the G4 exploration stage.
Ashok Leyland: net profit rose 0.78% year-on-year to Rs 615.81 crore in the April-June quarter. The board also approved investing up to 25 million pounds (about Rs 325 crore) in subsidiary Optare Plc and up to Rs 500 crore in Hinduja Housing Finance Ltd by purchasing shares from Hinduja Leyland Finance Ltd.
Aurobindo Pharma: subsidiary Eugia Pharma Specialities Ltd received a USFDA Warning Letter for its Unit-I formulation manufacturing facility after earlier OAI classification.
Word of the Day
Dead Cat Bounce
Even the worst of assets rise up after falling severely, only to fall again soon
A dead cat bounce is often seen in stocks of even the most severely affected companies that have almost no chance of a revival.
This usually happens because after a severe fall, some investors become hopeful that things will improve.
Often, they think so simply by looking at the fall numbers and not looking at the fundamentals of the company.
This leads to a temporary rise in the stocks’ price.
Obviously this pattern can be seen in the prices of all kinds of poor assets, not just stocks, bonds, commodities, etc.
6 Day Course
Theme: micro-cap investing
Day 5: Friday
Micro-cap investing also happens to have some companies with extremely low float.
This means that some of these companies’ total shares being traded on the markets is extremely small.
This means that even a little bit of buying/selling can drastically affect the price of the stock, causing it to shoot up or down.
Sadly, this nature of these stocks also makes it vulnerable to pump-and-dump scams.
On the flip side, if the due diligence is done well, some of these stocks can experience meteoritic rise — the kind seen in the case of startup investments.
The trick is in identifying these companies, which can be extremely difficult.
Such cases are not as common as we’d like to believe. They happen, but it is not a given that such returns will be achieved by all micro-cap companies.
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Featured Question
Q. “I noticed yesterday that Sensex ended the day in green and Nifty ended in red. Why does this happen?”
This happens from time to time. This is not abnormal.
Nifty 50 is made up of 50 of the biggest companies on the stock markets.
Sensex is made up of the 30 biggest companies.
So, they are mostly similar and share the first 30 stocks. But Nifty 50 also has 20 more stocks in it.
If by chance, those extra 20 stocks’ performance is different, it can cause the Nifty 50’s performance to vary from the Sensex’ performance.
On most days, Nifty 50 and Sensex’ performance is similar but almost never the same.
On days the markets are flat, this small difference can mean that the Sensex was just above 0% (meaning green) and Nifty was just below 0% (meaning red). Or vice versa.
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