F&O Manual | Bank stocks keep markets in green, Bank Nifty may recover above 43,000

Among individual stocks, Jindal Steel, Delta Corp, and Indigo witnessed a long build-up, while Zeel and HDFCLife saw a short build-up.

The benchmark Indian indices opened gap-up on October 25 after heavy sell-off on Monday. HDFC Bank, Reliance Industries, Zomato, BSE and Axis Bank were among the most active shares on the Nifty as the day progressed. Among sectors, metal and PSU Bank indices were up 1-1.5 percent intraday.

At 11am, he Sensex was up 4.21 points or 0.01 percent at 64,576.09, and the Nifty was down 0.10 points at 19,281.70. About 1,821 shares advanced, 1,207 declined, and 116 traded unchanged.

"The markets have displayed an upward trend today primarily for two reasons: First, US companies have reported robust earnings, and second, the stimulus measures in China. Now, the impact of China's stimulus on global markets and the global economy will be closely monitored. If the markets react positively to the stimulus, we may witness a short-term bottom forming on Monday, with markets rebounding from there. However, if the markets remain more concerned about geopolitical events and the rising crude oil prices, this bounce may be short-lived," Deepak Jasani, head of retail research at HDFC Securities, said.

Options data suggests a tussle between Put and Call writers with the 19,300 strike forming a key straddle position. "The Nifty has been consolidating around 19,300, as derivative data suggests an oversold condition for the Nifty. The Nifty PCR had fallen from 0.90 to 0.70 on Monday, which clearly suggests an overreaction by market participants in a short period. Therefore, we can't rule out the chance of a bounce," Rupak De, Senior Technical Analyst at LKP Securities, said.

"The immediate hurdle is seen at 19,350, and a decisive trade above this level might take the Nifty towards 19,500, where significant Call writing is visible. Support on the lower end can be found at 19,200-19,250," he added.

On Bank Nifty, De said: "Decent put writing at 43,000 might provide the necessary support for Bank Nifty. On the higher end, resistance is placed at 43,700-44,000. A recovery is expected as long as it holds above 43,000."

Among individual stocks, Jindal Steel, Delta Corp, and Indigo witnessed a long build-up, while Zeel and HDFC Life saw a short build-up.

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