After trading in a narrow range, the market ended the volatile session on a flat note with a positive bias on January 31, as the participants await Union Budget on February 1 to take cues for further direction of equities.
The BSE Sensex rose 50 points to 59,550, while the Nifty50 gained 13 points at 17,662 and formed a bearish candle with a long lower shadow on the daily charts indicating the buying at lower levels. The index has taken support at 17,550, the 200 DEMA (daily exponential moving average).
"The Nifty sustained above the crucial lower support of 200-day EMA in the short term, after a small whipsaw. We observe upside bounces in the Nifty soon after the sharp downside breakout of the broader high-low range at 17,800 level. These are positive signals which are unfolding as per daily timeframe chart," Nagaraj Shetti, Technical Research Analyst at HDFC Securities said.
He feels a decisive upside breakout of the hurdle at 17,800 level could confirm a near-term bottom reversal in the market.
The market is all set to show fresh direction after the Union Budget 2023, which will be presented on February 1, the market expert said.
The broader markets performed much better than benchmarks on strong breadth. The Nifty Midcap 100 and Smallcap 100 indices have gained 1.6 percent and 2.9 percent respectively.
We have collated 15 data points to help you spot profitable trades:
Note: The open interest (OI) and volume data of stocks in this article are the aggregates of three-month data, and not just of the current month.
Key support and resistance levels on the Nifty
As per the pivot charts, we have the key support level for the Nifty at 17,569, followed by 17,523, and 17,447. If the index moves up, the key resistance levels to watch out for are 17,721, followed by 17,768 and 17,843.
The Nifty Bank has outperformed equity benchmarks, rising 268 points to 40,655 and formed a small-bodied bullish candle on the daily charts with a long lower shadow indicating support-based buying at lower levels.
The important pivot level, which will act as crucial support for the index, is placed at 40,299, followed by 40,147, and 39,901. On the upside, key resistance levels are placed at 40,791, followed by 40,943, and 41,189.
On the weekly basis, we have seen the maximum Call open interest (OI) at 18,000 strike, with 90.25 lakh contracts, which may be a crucial resistance level in coming sessions.
This is followed by 19,000 strike, comprising 79.33 lakh contracts, and 18,500 strike, where we have more than 77.35 lakh contracts.
Call writing was seen at 18,500 strike, which added 18.91 lakh contracts, followed by 18,600 strike, which added 18.24 lakh contracts, and 18,700 strike, which added 7.49 lakh contracts.
We have seen Call unwinding in 17,800 strike, which shed 7.92 lakh contracts, followed by 17,700 strike, which shed 3.59 lakh contracts, and 17,500 strike, which shed 3.16 lakh contracts.
On a weekly basis, the maximum Put OI was seen at 17,000 strike, with 54.03 lakh contracts, which can be a crucial support level for coming sessions.
This is followed by the 16,500 strike, comprising 45.19 lakh contracts, and 17,500 strike, where we have 38.42 lakh contracts.
Put writing was seen at 16,700 strike, which added 13.67 lakh contracts, followed by 16,300 strike, which added 12.62 lakh contracts, and 17,600 strike which added 12.08 lakh contracts.
Put unwinding was seen at 17,300 strike, which shed 4.16 lakh contracts, followed by 17,100 strike, which shed 1.72 lakh contracts, and 16,900 strike, which shed 1.36 lakh contracts.
Stocks with a high delivery percentage
A high delivery percentage suggests that investors are showing interest in these stocks. We have seen the highest delivery in Syngene International, ICICI Lombard General Insurance, Nestle India, HDFC, and SBI Life Insurance Company, among others.
An increase in open interest (OI), along with an increase in price, mostly indicates a build-up of long positions. Based on the OI percentage, we have seen a long build-up in 69 stocks including Syngene International, Can Fin Homes, Container Corporation of India, Dalmia Bharat, and ONGC.
A decline in OI, along with a decrease in price, mostly indicates long unwinding. Based on the OI percentage, 13 stocks saw long unwinding, including Coforge, Max Financial Services, Infosys, Abbott India, and Britannia Industries.
An increase in OI, along with a decrease in price, mostly indicates a build-up of short positions. Based on the OI percentage, we have seen a short build-up in 29 stocks including Whirlpool of India, Hindalco Industries, IndusInd Bank, Sun Pharma, and Torrent Pharma.
81 stocks witnessed short-covering
A decrease in OI, along with an increase in price, mostly indicates a short-covering. Based on the OI percentage, 81 stocks were on the short-covering list, including Chambal Fertilisers, City Union Bank, Atul, UltraTech Cement, and IDFC First Bank.
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Britannia Industries, Ashok Leyland, Ajanta Pharma, Alembic Pharmaceuticals, Gillette India, IDFC, Jubilant FoodWorks, Kaya, Mahindra Logistics, Ramco Systems, Raymond, Redington, RPG Life Sciences, Sundram Fasteners, Tata Chemicals, Timken India, UTI Asset Management Company, Whirlpool of India, and Zuari Agro Chemicals will be in focus ahead of quarterly earnings on February 1.
Stocks in the news
Auto stocks to be in focus: Auto companies including Tata Motors, Ashok Leyland, Bajaj Auto, Hero MotoCorp, Maruti Suzuki India, TVS Motor Company, Escorts, and Eicher Motors will be in focus ahead of monthly sales volume numbers for January 2023.
Coal India: The country's largest coal mining company recorded profit at Rs 7,719 crore for the quarter ended December FY23, rising 69 percent YoY on the back of higher add-on over the notified price in e-auction sale of 14.65 million tonnes (MTs) of coal during the quarter. Consolidated revenue grew by 24 percent YoY to Rs 35,169 crore for the quarter with strong realisation. The realisation per tonne of coal was Rs 5,046 under the auction segment, in Q3FY23 against Rs 1,947 per tonne for the comparable quarter in FY22. The jump was Rs 3,099 per tonne or 159 percent.
Great Eastern Shipping: The company reported a 205 percent year-on-year growth in consolidated profit at Rs 627.2 crore for the quarter ended December FY23 led by healthy topline and operating performance. Revenue from operations at Rs 1,421 crore increased by 51.4 percent compared to the year-ago period.
Procter & Gamble Hygiene & Health Care: The FMCG company recorded a 2.2 percent year-on-year decline in profit at Rs 207.5 crore for the quarter ended December FY23 hit by weak operating margin and muted topline growth. Revenue grew by 4 percent to Rs 1,137.4 crore compared to the year-ago period. At the operating level, EBITDA declined 2 percent YoY to Rs 290.5 crore and the margin dropped 158 bps YoY to 25.54 percent for the quarter. The company declared an interim dividend of Rs 80 per share.
RailTel Corporation of India: The company recorded a 52 percent year-on-year decline in consolidated profit at Rs 31.95 crore for the quarter ended December FY23 on a high base. The year-ago period included higher other income, which fell from Rs 56.46 crore in Q3FY22 to Rs 7.85 crore in Q3FY23. Revenue from operations grew by 9 percent YoY to Rs 454.32 crore for the quarter.
Cholamandalam Investment and Finance Company: The company recorded 31 percent year-on-year growth in profit at Rs 684 crore for December FY23 quarter. Net income jumped 22 percent YoY to Rs 1,832 crore, with disbursements rising 68 percent to Rs 17,559 crore for the quarter. Total AUM crossed the milestone of Rs 1 lakh crore at Rs 1.03 lakh crore, up 31 percent YoY. Despite high inflation and high interest rates, strong festive season sales and workforce returning to metro cities have helped drive growth.
Sterlite Technologies: The company has signed an agreement to sell its telecom product software business via a business transfer agreement by way of slump sale as a going concern to Skyvera through its Indian subsidiary. The company will receive $15 million from the sale of the telecom product software business. Skyvera LLC is an affiliate of TelcoDR, which is a US-headquartered global acquirer of telecommunication software businesses.
Fund Flow
Foreign institutional investors (FII) have net-sold shares worth Rs 5,439.64 crore, whereas domestic institutional investors (DII) have net-bought shares worth Rs 4,506.31 crore on January 31, as per provisional data available on the NSE.
Stocks under F&O ban on NSE
The National Stock Exchange has retained Ambuja Cements on its F&O ban list for February 1. Securities thus banned under the F&O segment include companies where derivative contracts have crossed 95 percent of the market-wide position limit.
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