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Early on D-Street: Nifty may retest lifetime highs above 11,800, critical support at 11,627

Nifty decisively broke above 11,700 levels which is a positive sign but faced selling pressure near 11,810

October 30, 2019 / 08:15 AM IST

The festive cheer continues on D-Street as both Sensex and Nifty50 broke above crucial resistance levels on October 29. The Nifty50 closed above its crucial resistance level of 11,700-11,770 and is all set to make an attempt towards 12000 levels.

Tax cut reports lifted market sentiment while the markets in the near-term are likely to be driven by earnings outcome and Auto volume numbers which will be a crucial indicator of revival in consumer spending.

On the global front, investors would eye the outcome of US Fed meet (scheduled for October 29-30) which will influence the market trend, and any developments on the trade talk front between the US and China.

Let’s look at the final tally on D-Street – the S&P BSE Sensex rose 581 points to 39,831 while the Nifty50 rallied 159 points to close at 11,786 on October 29.

Close

Sectorally, the S&P BSE Auto index and Metal index rallied over 4 percent each, followed by the Energy index which was up 1.99 percent, and the Consumer Discretionary index gained 1.7 percent. The telecom index lost over 4 percent.

In the broader market space, the S&P BSE Mid-cap index rose 1.1 percent while the Small-cap index gained 0.55 percent.

Auto and Auto Ancillaries post healthy gains; Bharat Forge, Bosch & Motherson up 2-9 percent respectively thanks to the festive cheer.

On the institutional front, FPIs were net buyers in Indian markets for Rs 876 cr while the DIIs were also net buyers to the tune of Rs 144 cr, provisional data showed.

Big News

As many as 50 companies will declare their results for the quarter ended in September which include names like Container Corp, Graphite India, IFB Industries, Indoco Remedies, JK Tyre, OnMobile, PTC India, Quess Corp, Ramco Industries, Tata Chemicals, Tata Global Beverages, United Bank of India etc. among others.

Tata Chemicals: PAT likely to fall by 2 percent YoY, according to Motilal Oswal

Technical View

Nifty formed a bullish candle on the daily charts

It decisively broke above 11,700 levels which is a positive sign but faced selling pressure near 11810

If Nifty trades above 11,800 for a couple of trading sessions then decks will be cleared for it to retest recent lifetime highs of 12,103, suggest experts.

After the breakout, the trajectory of the index changed into buy on dips mode and hence any correction into the zone of 11,740 – 720 can be an opportunity to create fresh longs, they say.

On the downsides, 11,627 shall remain as critical support, and a breach of this on closing basis shall weaken the current upswing.

Three levels: 11,627, 11,810, 12,000

Max Call OI: 12,000, 11,800

Max Put OI: 11,700, 11,600

 

Stocks in news

Petronet LNG: Q2 consolidated profit jumps 96 percent to Rs 1,103 crore versus Rs 563 cr.

SKF India: Q2 September profit rose to Rs 84.62 crore compared to Rs 84.3 crore seen in the year-ago period.

PVR: Company closes QIP, fixes issue price at a price of Rs 1,719.05 per share.

BEML: The government started the divestment process for BEML, likely to do strategic stake sale - as per CNBC-Awaaz sources.

 

Technical Recommendations

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

BEML Ltd: Buy | LTP: Rs 1,008 | Target: Rs 1,115 | Stop Loss: Rs 920 | Upside 10 percent

KEI Industries Ltd: Buy | LTP: Rs 575 | Target: Rs 645 | Stop Loss: Rs 525 | Upside 12 percent

Timken India Ltd: Buy | LTP: Rs 821 | Target: Rs 922 | Stop Loss: Rs 750 | Upside 12 percent

Disclaimer: The views and investment tips expressed by investment experts 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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Kshitij Anand is the Editor Markets at Moneycontrol.
first published: Oct 30, 2019 08:03 am
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