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Last Updated : Aug 20, 2019 07:18 AM IST | Source: Moneycontrol.com

A morning walk down Dalal Street | Upward momentum should strengthen further if Nifty closes above 11,150

Bank Nifty needs to hold and sustain above 28,200 levels to witness a bounce towards 28,500 then 28,750 levels, while on the downside supports are seen at 28,000 then 27,750 levels, experts said.

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Frontline index Sensex closed 52 points higher on Monday, well off its intra-day highs, as losses in index heavyweights like ITC, HDFC Bank and SBI kept bulls in check.

At one point during the day, the index was quoting 369 points over its previous close.

Close

The market failed to hold altitude as concerns over weakening economy persist. Moreover, delay in a formal announcement by the government about fiscal stimulus is also making investors nervous.

Among the broader indices, BSE Midcap and Smallcap indices outperformed benchmark Sensex, rising 0.2 percent and 0.5 percent, respectively.

The Indian rupee weakened by 28 paise to close at 71.43 per dollar.

On the institutional front, FPI were net sellers in Indian markets for Rs 306 crore while DIIs were net buyers to the tune of Rs 386 crore, provisional data showed.

Big news:

A government-appointed task force has submitted its report to Finance Minister Nirmala Sitharaman on the new Direct Tax Code, which seeks to replace the existing Income Tax Act.

The task force was assigned to draft direct tax laws in line with the norms prevalent in other countries, incorporating international best practices, and keeping in mind the economic needs of the country.

Technical view:

The Nifty index formed a small bearish candle that resembled a shooting star formation on the daily charts, as selling pressure was seen at higher levels.

A shooting star pattern is formed when the index comes under selling pressure as traders start booking profits at higher levels.

The index found hurdle near to its 21-day exponential moving average (around 11,150), which could be a crucial level for further upside, experts feel.

If bulls push the index beyond 11,150 on closing basis then upward momentum should strengthen further with initial targets placed around 11,260 and beyond that bigger targets cannot be ruled out. Bank Nifty needs to hold and sustain above 28,200 levels to witness a bounce towards 28,500 then 28,750 levels, while on the downside supports are seen at 28,000 then 27,750 levels, experts said.

Three levels: 11,038 (intraday low of Monday), 11,147 (intraday high of Monday), 11,183 (200-DMA)

Max Call OI: 11,500, 11,000

Max Put OI: 11,000, 10,700

Stocks in news:

Microfinance lender Spandana Sphoorty Financial made a tepid debut on the market on August 19. The stock listed at a 4 percent discount to the issue price of Rs 856, and while it recovered partially, the closing price of Rs 848.40 was about 1 percent below the issue price.

Shares of Sun Pharmaceutical Industries climbed 2.6 percent to Rs 425.80 on August 19 after the US health regulator classified company's Halol plant as 'No Action Indicated'

Shares of DHFL jumped 6.86 percent to Rs 49.05 on August 19 after media reports suggested that the lenders to the company agreed to work on a resolution plan which includes converting part loans to equity.

Technical Recommendations:

We spoke to HDFC Securities and here’s what he has to recommend:

MCX India: Buy | LTP: 865 | Stop Loss: Rs 830 | Target: Rs 935 | Upside 8%

Hero MotoCorp: Buy | LTP: Rs 2,637 | Stop Loss: Rs 2,500 |Target: Rs 2,800 | Upside 6%

Marico: Buy | LTP: Rs 394.95 | Stop Loss: Rs 380 | Target: Rs 423 | Upside 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 20, 2019 07:15 am
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