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Last Updated : Dec 03, 2019 07:44 AM IST | Source: Moneycontrol.com

Early on D-Street | Critical support for Nifty at 12,006

In the near term critical support for the index is placed around 13-Day exponential moving average placed around 12,006 levels, and below that 11800 will act as support.

Indian market witnessed profit booking decline for the second consecutive day in a row on Monday. Both Sensex and Nifty closed flat.

Let’s look at the final tally on D-Street – the S&P BSE Sensex rose 8 points to 40,802 while the Nifty50 closed 7 points lower at 12,048 on Monday.

Close

Sectorally, the action was seen in telecom, energy, and metals while profit booking was seen in auto, IT, and healthcare stocks.

The broader markets underperformed as the S&P BSE Mid-cap index fell 0.77 percent while the S&P BSE Small-cap index was down 0.39 percent.

Weak Q2 GDP data which hit a 6-year low and subdued auto sales numbers is likely to impact the investor sentiments in the short-term, but investors pinned hopes for a rate cut by the Reserve Bank of India (RBI).

The Monetary Policy Committee (MPC) will cut interest rates for the sixth straight time on December 5 to support growth that has continued to slip to more than six-year low, suggest experts.

The Indian rupee on December 2 settled 8 paise higher at 71.66 against the US dollar amid participants hoping Reserve Bank will go for another rate cut in the ensuing RBI policy review meet this week.

On the institutional front, FPIs were net sellers in Indian markets for Rs 1731 cr, while the DIIs were net buyers to the tune of Rs 753 cr, provisional data showed.

Big News:

Is it time to revisit Midcaps? Midcaps can turn out to be big wealth spinners for those looking to remain invested in the market for more than a year.

The reason to buy mid or smallcaps is the high return potential if one can pick a multibagger, Citigroup says in a November 25 research report.

“We have looked at the last 10 years' performance to see what the odds are and no surprises. It remains tough to call those multibaggers, as only 2 percent of smallcaps become largecaps, while 20 percent no longer exist (or are no longer listed),” the report says.

Top stocks on Citigroup radar include names like ACC, Apollo Hospitals, Biocon, IGL, JSW Energy, JustDial, L&T Finance Holding, L&T Infotech, Phoenix Mills, Polycab India, and SRF.

Technical View:

Nifty50 formed a bearish candle on the daily charts for the second consecutive day in a row

Chart pattern suggests that the index is vulnerable to a selloff

In the near term critical support for the index is placed around 13-Day exponential moving average placed around 12,006 levels, and below that 11800 will act as support.

Upsides shall remain capped around 12160 unless Nifty manages a strong breakout above the said level. Traders for time being are advised to remain neutral on the long side and look to short this market on a close below 12000 levels, suggest experts.

Three levels to watch on Tuesday: 12006, 12137, 12200

Stocks in news:

Biocon and its partner Mylan on December 2 announced the launch of Ogivri - a biosimilar to Herceptin - in USA.

Midcap private sector lender RBL Bank launched the qualified institutional placement issue for subscription on December 2. The Capital Raising Committee of the bank approved the floor price for the QIP being Rs 352.57 per equity share, at a 5.5 percent discount to Monday's closing price.

World Bank Group arm IFC on December 2 said it has anchored an investment round of $200 million (about Rs 1,433 crore) in Mahindra and Mahindra Financial Services to create a dedicated pool of financing for MSMEs in low-income states.

Technical Recommendations:

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

Kotak Mahindra Bank: Buy| LTP: Rs 1633| Target: Rs 1,750| Stop-Loss: Rs 1565| Upside 7%

BEML: Buy| LTP: Rs 1037| Target: Rs 1160| Stop-Loss: Rs 970| Upside 12%

Astrazeneca Pharma: Buy| LTP: Rs 2811| Target: Rs 3,100| Stop-Loss: Rs 2650| Upside 10%

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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First Published on Dec 3, 2019 07:44 am
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