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Last Updated : Aug 06, 2019 07:49 AM IST | Source: Moneycontrol.com

A morning walk down Dalal Street | Higher volatility suggests bear dominance & pessimism in market

Experts feel the 10,782, the lowest point of August 5, could be a crucial level to watch out for the coming session, as there could be a sharp correction if the level breaks.

Moneycontrol News @moneycontrolcom

A black Monday! Indian markets which were already reeling under the pressure of global cues saw a knee jerk react after the government revoked Article 370 to take away Jammu and Kashmir's special status.

The border state will be bifurcated. Jammu and Kashmir will be a Union Territory with a legislature, while Ladakh region will be a union territory but without an assembly, home minister Amit Shah told the Rajya Sabha in the morning.

Close

The index hit a record high of 12,103 in June and has since shed more than 1,200 points, or little over 10 percent, to touch 10,862 on August 5.

More than 500 BSE stocks hit a fresh 52-week low. These included Indian Bank, Future Consumer, V Mart Retail, YES Bank, Tata Motors (DVR), Tata Motors, Fortis Health, JSPL, Wockhardt, Tata Steel, Hindalco Industries, GAIL India, Bank of India, Motherson Sumi, Escorts and ITC.

The rupee on August 5 crashed by 113 paise -- the biggest single-day drop in the past six years -- to close at a five-month low of 70.73 due to heavy capital outflows by investors anxious over the US-China trade tension, a sharp devaluation in yuan and uncertainty over Kashmir issue.

On the institutional front, FPIs were net sellers in Indian markets for Rs 2016 cr while the DIIs were net buyers to the tune of Rs 1871 cr, provisional data showed.

Big News:

As many as 104 companies will declare their results for the June quarter which include names like Aditya Birla Fashion, Arvind, BASF India, Central Bank of India, Fortis Healthcare, Indiabulls Housing Finance, JSW Energy, Pidilite Industries, REC, Thomas Cook, Titan Company etc. among others.

Titan Company: PAT likely to grow by 8.6% YoY

Indiabulls Housing Finance: PAT likely to fall by 21% YoY

Aditya Birla Fashion: PAT likely to grow by 1609% YoY

(All the estimates are from Motilal Oswal)

Technical View:

Nifty formed a Hammer like pattern on the daily charts

Experts feel the 10,782, the lowest point of August 5, could be a crucial level to watch out for the coming session, as there could be a sharp correction if the level breaks.

In the near term, it is crucial for this counter to sustain above 10,783 levels, as a breach of this on the closing basis can drag down the index towards 10,566–10,497 levels

Upsides level, for the time being, shall remain uncertain with a cap around 11,080 levels

India VIX moved up by 9.19 percent to 16.58 level. Higher volatility suggests a bear dominance and pessimism in the market.

Three levels: 10782, 10895, 11156

Max Call OI: 11000, 11500

Max Put OI: 11000, 10500

Stocks in news: 

Torrent Power on August 5 posted about 22 percent rise in consolidated net profit at Rs 276.59 crore for June quarter compared with the year-ago period, mainly on the back of higher revenues.

Bombay Dyeing & Manufacturing Co Ltd on Monday reported a standalone net profit of Rs 27.65 crore for the first quarter ended June 2019. The company had posted a net loss of Rs 93.70 crore in the April-June period a year ago, Bombay Dyeing said in a BSE filing.

Public sector Indian Bank on Monday posted a 74.55 percent jump in its net profits for the April-June quarter, at Rs 365.37 crore, according to a top official.

Technical Recommendations:

We spoke to HDFC Securities and here’s what they have to recommend:

Tech Mahindra: Buy| LTP: Rs 648| Target: Rs 695| Stop-Loss: Rs 625| Return 7%

Dabur India: Buy| LTP: Rs 430| Target: Rs 455| Stop-Loss: Rs 415| Upside 6%

UPL: Sell| LTP: Rs 541| Target: Rs 505| Stop-Loss: Rs 565 | Downside 7%

Disclaimer: The views and investment tips expressed by investment expert on Moneycontrol.com are his own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.


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First Published on Aug 6, 2019 07:18 am
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