The Nifty50 snapped its 4-day losing streak on January 24 but failed to reclaim 12,200 levels which is crucial for bulls to regain control, suggest experts.
Overnight, the US markets hit a fresh record high but Asian markets were trading with negative bias on Friday as worries over the rapid spread of the deadly virus kept investors on guard.
Trends on SGX Nifty indicate a negative opening for the broader index in India, with a 21 points, or 0.17 percent, loss. The Nifty futures were trading around 12,175-level on the Singaporean Exchange.
The S&P BSE Sensex rallied nearly 300 points while the Nifty50 closed near its intraday high of 12,189.
Let’s look at the final tally on D-Street – the S&P BSE Sensex rose 271 points to 41,386 while Nifty50 closed with gains of 73 points to 12,180.
Sectorally, action was seen in the capital goods space, followed by realty, oil & gas, infrastructure, and telecom stocks. There were no sectoral losers. Nifty Bank advances 303 points with all its constituents in the green.
On the macro front, the government's tax revenue shortfall for FY20 is estimated to be at around Rs 2 lakh crore, sources told CNBC-TV18. The government is reportedly assessing the revenue impact of tax relief proposals for the upcoming Budget.
To tap into foreign capital, the Reserve Bank of India on January 23 raised the investment limit for FPIs in the government and corporate bonds, a move that is likely to bring in more foreign funds into the country.
According to the current norms, short-term investments by a foreign portfolio investor (FPI) should not exceed 20 percent of the total investment of that FPI in either central government securities (including treasury bills) or state development loans.
The short-term investment limit has now been increased from 20 percent to 30 percent in both the cases, the RBI said in a circular.
The rupee depreciated by 7 paise to close at 71.26 against the US dollar on Thursday as the spread of a deadly new virus from China spooked investors.
On the institutional front, FPIs were net buyers in Indian markets for Rs 1352 cr while the DIIs were net sellers to the tune of Rs 984 cr, provisional data showed.
Big News:
As many as 35 companies on the BSE will declare their results for December quarter that include names like Aavas Financiers, Bank of Baroda, Emkay Global, JSW Steel, Sonata Software, Supreme Industries, UltraTech Cements etc. among others.
UltraTech Cement: PAT likely to grow by 86% YoY
Bank of Baroda: Likely to report a loss of Rs 563 cr
JSW Steel: PAT likely to fall by 71% YoY
(All estimates are from Motilal Oswal)
Technical View:
Nifty formed a bullish candle as it took support near the 50-EMA placed at 12080
If Nifty sustains above 12094 levels (intraday low) and attracts a follow-through buying in the next session
However, the strength for bulls can be expected on a close above 12225 levels which could take the index towards 12298-12361 levels
A close below 12087 can resume the weakness in the index with targets placed around 11900 levels.
Three levels: 12094, 12189, 12225
Max Call OI: 12500, 12300
Max Put OI: 12000, 11500
Stocks in the news:
Westlife Development Ltd, the owner of master franchisee of McDonald's restaurants in West and South India, on Thursday reported over three-fold jump in consolidated net profit after tax at Rs 22.72 crore in the third quarter ended December 2019.
JM Financial on January 23 reported a 14.6 per cent rise in its net income to Rs 157.5 crore for the December 2019 quarter, despite a muted growth in total income as its disbursals shrunk during the period.
GAIL India: The Department of Telecommunications seeking nearly Rs 3 lakh crore in dues from non-telecom PSUs, such as GAIL, Oil India Ltd and PowerGrid, was a result of "communication gap" as these firms do not owe any such amount, Oil Minister Dharmendra Pradhan said on January 24.
Engineering, procurement and construction major KEC International Ltd on Thursday said it has bagged new orders worth Rs 1,255 crore across various businesses.
Technical Recommendations:
We spoke to IndiaNivesh Securities and here's what they have to recommend:
HDFC | Sell | LTP: Rs 2,426.15 | Target: Rs 2,350 | Stop loss: Rs 2,500 | Downside: 3%
GAIL | Buy | LTP: Rs 129.60 | Target: Rs 138 | Stop loss: Rs 124.5 | Upside: 6%
Indian Bank | Buy | LTP: Rs 104.45 | Target: Rs 116 | Stop loss: Rs 98 | Upside: 11%
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