Early on D-Street| Upside in Nifty to remain capped unless index breaks above 11,700

It was a muted Tuesday on for D-Street after a long weekend. The S&P BSE Sensex plunged by more than 300 points while Nifty50 closed below 11600 levels on a closing basis.

The final tally on D-Street – the S&P BSE Sensex plunged 334 points to close at 38,963 while the Nifty50 dropped 73 points to close at 11588.

The biggest drag on both Sensex and Nifty was Infosys which plunged over 16 percent to mark its biggest single-day fall since April 2013. The stock is now trading at levels last seen around December 2018. The stock closed at Rs 643.30 on the BSE.

As shares of Infosys plunged more than 16 percent, investors lost more than Rs 50,000 cr as market capitalisation fell from Rs 3,26,939 on October 18 to Rs 2,76,300 cr.

The market is expected to remain volatile in the near term, and the trend will be dictated by the on-going earning season, the outcome of the state election, US-China trade deal, and development on the Brexit deal, they say.

The Indian rupee on Tuesday closed higher for the four fourth consecutive session to hit a one-week high against the US dollar on the back of recent gains in domestic equity markets.

On the institutional front, FPIs were net sellers in Indian markets for Rs 557 cr while the DIIs were also net sellers to the tune of Rs 985 cr, provisional data showed.

As many as 78 stocks will declare their results for the September quarter which include names like Aarti Drugs, Bajaj Auto, Biocon, Castrol India, HCL Technologies, Hero MotoCorp, JSW Steel, KPIT Tech, L&T, NIIT Tech, Torrent Pharma, and ZEE Media, etc. among others.

Bajaj Auto: PAT likely to grow by 6% YoY

HCL Tech: PAT likely to fall by nearly 1% YoY

Hero MotoCorp: PAT likely to fall by 12% YoY

(All the estimates are from Motilal Oswal)

Nifty forms a bearish candle on the daily charts but closed above its 5-days EMA at 11,543.

It was a day of consolidation for Indian markets after a 3% rally seen in the week gone by.

Important resistance levels are placed near 11700-11770, suggest experts

Weakness in the index shall get more pronounced if it closes below 11550 levels.

Unless index consolidates around these levels and witnesses a fresh breakout above 11700 levels further upsides remain limited, suggest experts

We expect the market to remain either sideways or witness more profit booking in the next couple of trading sessions. In case, if 11550 is breached on a closing basis then the initial target shall be placed around 11430 levels, they say.

But, a strong close above 11700 shall resume the upmove with initial targets placed in the zone of 11,772 – 11,798 kinds of levels

Three levels to track on Wednesday – 11,573, 11772, 12000

Max Call OI: 12000, 11700

Max Put OI: 11000, 11500

Private sector lender RBL Bank's July-September quarter profit fell sharply by 73.4 percent year-on-year due to a sharp spike in provisions, and asset quality also deteriorated sequentially.

Drug firm Lupin on October 22 said it has received approval from the US health regulator to market its generic Divalproex Sodium extended-release tablets in the American market.

Axis Bank on October 22 reported a net loss of Rs 112.1 crore, posting below expectation September quarter numbers for the financial year 2020 on October 22.

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

Dr Reddy's Laboratories: Buy| LTP: Rs 2812| Target: Rs 3050| Stop Loss: Rs 2620| Upside 8.4%

Tata Global Beverage: Buy| LTP: Rs 281| Target: Rs 307| Stop Loss: Rs 265| Upside 9%

Housing Development Finance Corporation: Buy| LTP: Rs 2115| Target: Rs 2300| Stop Loss: Rs 1980| Upside 8.7%

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