Stock Market Closes Flat: Adani Stocks Rebound After Initial Dip, Hindenburg Report Fails To Deter Sentiment

Adani-Hindenburg Saga

Mumbai: In a day marked by fluctuations, the stock market closed flat on Monday, despite Adani stocks rebounding after an initial dip. The BSE Sensex ended 56.98 points lower, settling at 79,648.92, while the NSE Nifty declined by 20.50 points to close at 24,347.00. Among the Nifty companies, 19 saw advances while 30 recorded declines.

Ajay Bagga, a banking and market expert said, "Indian markets managed a recovery after opening down in the morning on the back of the overhang of the Hindenburg report over the weekend. The markets proved resilient and buying emerged at lower levels to help both the frontline and broader indices to recover from the day low into the close."

He added, "Overall, sentiment is more focussed on geopolitical risk from Iran-Israel potential conflict, the unwinding of the Yen carry trade and key data on inflation from the US and Europe this week. The Hindenburg accusations did not have much of an impact on the markets. Global cues remain predominant for now."

Varun Aggarwal, Founder and Managing Director of Profit Idea, noted, "The ongoing dispute between Hindenburg Research and the Adani Group has intensified, with Hindenburg alleging a conflict of interest involving SEBI chairperson Madhabi Puri Buch."

He added, "Despite significant declines in Adani Group's stock valuation following Hindenburg's January 2023 report, partial recoveries have been noted. Buch and SEBI have responded by clarifying that Buch's investments predate her tenure at SEBI, and the fund involved did not invest in Adani stocks. SEBI has concluded investigations into 23 of 24 issues, with six Adani companies receiving show cause notices."

The market's movements came in the wake of renewed concerns from the Hindenburg report over the weekend, which initially weighed down sentiment. However, the markets showed resilience, with buying interest emerging at lower levels, helping both frontline and broader indices to recover from their intraday lows.

Meanwhile, the Indian Rupee is expected to face slight weakening pressures due to a strengthening US Dollar and rising global crude oil prices. These factors are compounded by foreign selling pressures and ongoing geopolitical tensions in the Middle East.

However, positive global market trends may provide some support to the Rupee. Market participants will be closely watching India's upcoming Consumer Price Index (CPI) and Index of Industrial Production (IIP) data, along with key economic indicators from the US.

The day's market performance underscores the complex interplay of global geopolitical developments, domestic regulatory concerns, and investor sentiment in shaping the direction of Indian equities.

Adani Green and Ambuja Cements closed in green while other stocks of Adani Group closed marginally down after recovering from dips.
Notably, ONGC, Hero MotoCorp, Axis Bank, JSW Steel, and Divi's Laboratories emerged as the top gainers. On the flip side, Adani Ports, NTPC, Dr Reddy's Laboratories, Britannia, and Adani Enterprises were among the top losers, with Adani Group stocks showing a mixed performance after rebounding from an initial dip.