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Last Updated : Dec 16, 2019 07:31 AM IST | Source: Moneycontrol.com

Early on D-Street | Further upside likely; Nifty may touch 12,150-12,200 during the week

Nifty as per weekly timeframe formed a long bull candle with lower shadow. This candle pattern was formed immediately after the formation of a bearish engulfing type pattern in the last week.

 
 
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Key equity indices Sensex and Nifty logged strong gains on December 13, buoyed by positive global sentiment as investors cheered signs of progress in the US-China trade talks while hopes of a smooth Brexit grew stronger after a decisive election win by the Conservative Party in the UK polls.

Investors shrugged off domestic data showing a deepening of the industrial slowdown and a spike in retail inflation to over three-year high.

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Sensex settled 428 points, or 1.05 percent, higher at 41,009.71 while Nifty closed the day with a gain of 115 points, or 0.96 percent, at 12,086.70. Midcaps and Smallcaps, too, witnessed decent gains but underperformed the benchmark Sensex. BSE Midcap closed 0.92 percent up and the Smallcap index settled 0.82 percent up.

Barring BSE Telecom, all sectoral indices settled with gains, with the metal pack jumping 2.30 percent, followed by Realty, Teck, Capital Goods, Auto, IT, Industrials and Basic Materials, each gaining over a percent.

For the week, both Sensex and Nifty climbed by 1.4 percent.

The rupee closed flat at 70.83 to the US dollar on December 13 as surging crude oil prices weighed on the domestic unit.

On the institutional front, foreign institutional investors (FIIs) bought shares worth Rs 115.7 crore, while domestic institutional investors (DIIs), too, bought shares of worth Rs 384.92 crore in the Indian equity market on December 13, provisional data available on the NSE showed.

Big news: US-China trade deal cuts tariffs for Beijing

As per news agency Reuters, the United States and China cooled their trade war on November 13 and announced "Phase one" agreement that reduces some US tariffs in exchange for what officials said would be a big jump in Chinese purchases of American farm products and other goods.

Beijing has agreed to import at least $200 billion in additional US goods and services over the next two years on top of the amount it purchased in 2017, the top US trade negotiator said on November 13, reported Reuters.

Technical View:

Nifty as per weekly timeframe formed a long bull candle with lower shadow. This candle pattern was formed immediately after the formation of a bearish engulfing type pattern in the last week. This is a positive indication and one may expect further upside in the short-term.

"A sustainable move above 12,158 could nullify the negative implication of bearish engulfing," said Nagaraj Shetti, Technical & Derivative Analyst at HDFC securities.

Shetti said one may expect Nifty to reach up to 12,150-200 levels this week and there is a possibility of an emergence of selling pressure again around all-time highs.

Three levels: 12023.6, 12098.8, 12115.8

Max Call OI: 12,000, 12,200

Max Put OI: 12,000, 11,900.

Stocks in news:

Granules India: The company is to sell a stake in China JV to Hubei Biocause for 109 million Japanese yen.

Vardhman Textiles: The company has withdrawn scheme to merge 4 arms with itself.

Reliance Industries: The company's arm RSBVL acquired 51.8 percent in Asteria Aero for Rs 23.1 crore.

Minda Industries: The company completed the acquisition of German firm Delvis Gmbh.

S Chand and Company: The company's arm Vikas Publishing House has bagged Rs 6.4 crore contract from MP Bhoj Open University.

Technical Recommendations:

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

Balrampur Chini Mills | Buy | LTP: Rs 169.90 | Target price: Rs 203 | Stop loss: Rs 153.70

Larsen & Toubro | Buy | LTP: Rs 1,306 | Target price: Rs 1,355 | Stop loss: Rs 1,278

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 16, 2019 07:30 am
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