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Last Updated : Jul 05, 2019 07:13 AM IST | Source: Moneycontrol.com

A morning walk down Dalal Street | Nifty could either breakout above 12,103 or see selling pressure

There is a hint of caution ahead of the Budget as traders are waiting on sidelines ahead of the key event.

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Economic Survey failed to create the buzz ahead of the Budget 2019 as traders prefer to remain on sidelines before taking any directional bets.

The S&P BSE Sensex rose 68 points while the Nifty50 held on to 11900 levels. The final tally on D-Street – Sensex rose 68 points to 39,908 while Nifty closed 30 points higher at 11,946.

Close

Buying was seen in sectors like PSU banks, irrigation, FMCG, sugar and select fertiliser stocks on optimism ahead of Budget.

The index is likely to face stiff resistance around 12,000-12,100 but a pro-growth Budget could lead to a breakout on an intraday basis. Investors are advised to hedge their positions and use dips to buy as strong support is seen at 11,800.

The Indian rupee on Thursday furthered its gains by another 39 paise to 68.50 a US dollar, tracking firmer emerging market currencies, lower crude oil prices, even as participants keenly awaited the Union Budget to be unveiled on Friday.

On the institutional front, FPIs were net sellers in Indian markets for Rs 28 cr while DIIs were net buyers for Rs 58 cr, provisional data showed.

Big News:

All eyes will be on Nirmala Sitharaman’s first budget speech as the finance minister.

Economic Survey points out that growth has taken a hit but seems to have bottomed out now. Real GDP for the FY 2020 has been projected at 7 percent.

Ahead of the Budget, the report also highlighted that while the government has not deviated from the revised roadmap for fiscal consolidation which is a positive sign

Looking at the key aspects from the Survey market participants eye key policy measures in sectors which support the economy such as agri, rural consumption, automobiles, banking, NBFCs, etc.

There is a need to fast tacking resolution of non-performing assets of the banking sector which will go a long way in reviving the incremental private capex and growth of the economy.

Everyone expects the government to revive growth by way of a stimulus package for different sectors but the headroom is limited

On the capital market front, withdrawal of long-term capital gains tax would be cheered by the market. This would lead to higher equity participation by companies.

Technical View:

Nifty formed a bullish candle on the daily charts | 4 straight sessions of gains

The index decisively held 11,900 and gradually marched towards 12,000, forming bullish candle on daily charts.

There is a hint of caution ahead of the Budget as traders are waiting on sidelines ahead of the key event

Nifty could either breakout above 12103 on Friday or could see selling pressure which could drag the index towards 11800-11700 levels

Three levels: 11700, 11923, 12103

Max Call OI: 12000, 12500

Max Put OI: 11500, 11000

Technical Recommendations:

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

UltraTech Cement: Buy| Target: Rs 4924| Stop Loss: Rs 4505| Upside 6%

Amara Raja Batteries Ltd: Buy| Target: Rs 700| Stop Loss: Rs 627| Upside 8%

Bank of Baroda: Buy| Target: Rs 140| Stop Loss: Rs 123.5| Upside 8%

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 Jul 5, 2019 06:59 am
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