Ahead of Market: 12 things that will decide stock action on Friday

Ahead of Market: 12 things that will decide stock action on Friday

NEW DELHI: Nifty on Thursday failed to breach yesterday’s trading range as the headline index formed a small bullish candle on the daily chart.

Rohit Singre, Senior Technical Analyst at LKP Securities said, “The index has formed a good base near 14,500 zones. Holding above the said levels, we may see the index marching northwards and any dip around 14,500 zones will again be a buying opportunity. Immediate resistance is formed at 14,650 zones. Above that, we may see bullish momentum to continue again.”

“Despite better than expected results of Infosys and Wipro, IT sector witnessed selling in its opening trade. However, the sector bounced back soon, which led to a recovery in the market post its weak opening. The positive opening seen in European markets also helped in raising market optimism. Positive economic data along with improving quarterly outlook is helping the Indian market to attract more foreign funds, which will keep the market liquidity high even with these high valuations,” said Vinod Nair, Head of Research at Geojit Financial services.

That said, here’s a look at what some of the key indicators are suggesting for Friday’s action:
US stocks rise with focus on Biden’s stimulus plan

Wall Street’s main indexes gained on Thursday with investors awaiting details on President-elect Joe Biden’s proposals for stimulus to jump-start the economy as data showed a struggling job market recovery. The Dow Jones Industrial Average rose 149.2 points, or 0.48%, to 31,209.74. The S&P 500 rose 13.84 points, or 0.36%, to 3,823.47, while the Nasdaq Composite rose 40.8 points, or 0.31%, to 13,014.01.

European shares lifted by US stimulus hopes
European shares rose for a third straight session on Thursday, as hopes of a large stimulus under incoming US President Joe Biden and upbeat Chinese export data boosted sentiment. The pan-European STOXX 600 index rose 0.70%, with automakers, travel and mining stocks making it to the top gainers’ list.

Tech View: Nifty50 negates higher highs
Nifty50 on Thursday negated the formation of higher highs in the past 15 sessions and formed an Inside Bar on the daily chart. While the index has been holding up well of late, analysts said one must closely look at the advance-decline ratio and believe Nifty needs to respect the support at 14,435 level to keep the ongoing positive momentum going. “Nifty50 formed an Inside Bar and a bullish candle on a daily scale with a long lower shadow that indicates that the declines are being bought into. The index continued to form higher lows for six sessions now, but negated the formation of higher highs of last 15 sessions. The index may need to hold above the 14,450 level to see a fresh move towards the 14,750 level,” said Chandan Taparia of Motilal Oswal Securities.

Check out the candlestick formations in the latest trading sessions


F&O: VIX needs to cool down below 20 level
India VIX fell 1.13% from 23.29 to 23.02 levels. Volatility needs to cool down below 20 level for the Nifty form a higher base. There was Call writing at 14,800 and 14,600 levels, while Put writing was seen at 14,500 and then 14,100 levels. Options data suggested a wider trading range between 14,000 and 15,000 levels, while the immediate trading range lies between 14,300 and 14,800 levels.

Stocks showing bullish bias
Momentum indicator Moving Average Convergence Divergence (MACD) on Thursday showed bullish trade setup on the counters of NTPC, Vikas Ecotech, Union Bank of India, Reliance Industries, Cadila Healthcare, Ahluwalia Contracts, Nippon Life AMC, Indian Energy Exchange, Navneet Education, Triveni Engineering & Industries, Kansai Nerolac Paint, Mahindra EPC Irrigation, Spandana Sphoorty Financial, Tokyo Plast International, Tainwala Chem & Plastics, Poly Medicure, Indo Count Industries, Varroc Engineering, Solara Active Pharma, AIA Engineering, Izmo Ltd, South West Pinnacle and TTK Prestige.

Stocks signalling weakness ahead
The MACD showed bearish signs on the counters of National Aluminium Company, Vedanta, Indiabulls Real Estate, JSW Steel, Rashtriya Chemicals, Tata Consumer Products, Power Finance Corporation, Marico Ltd, Morepen Laboratories, ICICI Pru Life, Bombay Dyeing, Cummins India, Jubilant Foodworks, Praj Industries, Century Textiles, Birlasoft, Sterlite Technologies, Orient Electric, Mahanagar Gas, Dr. Reddy’s Labs, Colgate Palmolive, Jindal Stainless (Hisar), NRB Bearings, Mirza International, Nila Infrastructures, Phoenix Mills, Cochin Shipyard, Sundaram Fasteners, Somany Home Innovation, Supreme Industries, Ramco Industries, BASF India, Archidply Industries and Cera Sanitaryware.

Thursday’s most active stocks
Infosys (Rs 3741.11 crore), Wipro (Rs 3223.70 crore), TCS (Rs 2223.06 crore), SAIL (Rs 2175.85 crore), Tata Motors (Rs 2120.22 crore), RIL (Rs 1946.76 crore), Tata Elxsi (Rs 1768.21 crore), HCL Tech (Rs 1541.90 crore), IndusInd Bank (Rs 1445.63 crore) and Bajaj Finance (Rs 1313.11 crore) were among the most active stocks on Dalal Street on Thursday in value terms.

Thursday’s most active stocks in volume terms
SAIL (Shares traded: 32.04 crore), PNB (Shares traded: 18.42 crore), Vodafone Idea (Shares traded: 16.80 crore), YES Bank (Shares traded: 14.13 crore), Tata Motors (Shares traded: 8.68 crore), Bank of Baroda (Shares traded: 7.36 crore), Wipro (Shares traded: 7.16 crore), ITC (Shares traded: 4.83 crore), SBI (Shares traded: 4.01 crore) and BHEL (Shares traded: 3.50 crore) were among the most traded stocks in the session.

Stocks showing buying interest
Suven Pharma , Quess Corp, Laurus Labs, Tata Elxsi and Kansai Nerolac witnessed strong buying interest from market participants as they scaled their fresh 52-week highs on Thursday signalling bullish sentiment.

Stocks seeing selling pressure
Acrysil Ltd, Mrs. Bectors Food Specialities, Fairchem Organics, Jump Networks, Kanpur Plastipack and Vishal Fabrics witnessed strong selling pressure in Thursday’s session and hit their 52-week lows, signalling bearish sentiment on these counters.

Sentiment meter favours bears
Overall, market breadth remained in favour of bears. As many as 234 stocks on the BSE 500 index settled the day in green, while 257 settled the day in red.

Podcast: Will Nifty50 touch 15,000 ahead of Budget? >>>
Sensex came one step closer to the 50,000 mark on Thursday by adding 92 points to its previous close. Nifty stopped short of the 14,600 level. Analysts said quarterly numbers are good, FPI inflows strong and there is not much to worry for Dalal Street investors these days — a happy story so far. We caught up with Rusmik Oza of HDFC Securities to know his views on the market.

Source link


Please enter your comment!
Please enter your name here