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Another day of choppy movement for Indian markets but this time bears managed to take control of D-Street. The index snapped its 6-day winning streak on Tuesday.
The S&P BSE Sensex dropped by over 100 points to close at 36,134 while the Nifty50 end 14 points lower at 10,869.
Investors remained cautious ahead of the outcome of the Reserve Bank of India's (RBI) monetary policy meeting. The Monetary Policy Committee (MPC) will conclude its two-day meet on December 5, 2018.
Sectorally, IT index rose 1.7 percent while Oil & Gas rose 0.8 percent and on the losing front realty, telecom and FMCG stocks some bit of profit taking
In terms of technicals, Nifty formed a Doji kind of indecisive pattern on charts. On the downside 10,747 will be an important support to watch while on the upside 10950-10930 will act as crucial resistance for the index.
Big News:
MPC meet outcome will be an important level to watch out for
Most experts feel that it will be a wait and watch situation for the RBI and the central bank will resort to status-quo on rates
The GDP figures, after making high of over 8 percent, have fallen sharply to 7.1 percent level in Q2
The lower than expected expansion of GDP has put pressure on domestic markets.
It looks like the market has already priced in the uncertainty the way it has been moving in a narrow range since last Friday
A rate hike could impact markets negatively while any measure to boost liquidity could boost sentiment
Future commentary on rates will be watched by traders and will be an important factor in determining the trend for the markets
Technical View:
The index formed a Doji kind of pattern on daily charts
Momentum oscillators on lower time frame charts generated sell signals which is a cause for concern suggesting a near-term cap for upsides
Post the RBI event, if indices fail to rally beyond 10,950 levels then that can be a sign of near-term weakness for this market while a break below 10747 could lead to some bit of weakness
Three levels: 10747, 10833, 10950
Max Call OI: 11000, 10900
Max Put OI: 10500, 11000
Stocks in news:
Drug firm Lupin on December 4 said it has launched generic Silodosin capsules, used for the treatment of signs and symptoms of benign enlargement of the prostate gland, in the US market.
Rate-sensitive stocks will be in focus ahead of MPC Committee outcome
Drug firm Alkem Laboratories on Tuesday said the American health regulator has issued an Establishment Inspection Report (EIR) for the company’s St Louis (US) based manufacturing facility.
Technical Recommendations:
We spoke to SMC Global Securities and here’s what they have to recommend:
Tata Consultancy Services Limited: Buy| Target: Rs 2180| Stop Loss: Rs 1890| Return 9%
TVS Motor Company Limited: Buy| Target: Rs 611| Stop Loss: Rs 525| Return 9%
INOX Leisure Limited: Buy| Target: Rs 250| Stop Loss: Rs 210| Return 11%
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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