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Last Updated : Jan 28, 2020 09:24 AM IST | Source: Moneycontrol.com

Market Headstart: Coronavirus fears weigh on Street; Nifty may find support at 12,088

Trends on SGX Nifty indicate a negative opening for the index in India, with a 30 points, or 0.25 percent, loss

Indian market is expected to trade lower on Tuesday tracking muted trend seen in other Asian markets. The Nifty50 after the gap-down opening on Monday broke below 12200, and 12149 levels and is likely to find support near 12088 levels which is the 50-days EMA.

Trends on SGX Nifty indicate a negative opening for the index in India, with a 30 points, or 0.25 percent, loss. The Nifty futures were trading around 12,085-level on the Singaporean Exchange.

Asian stocks extended a global sell-off as China took more drastic steps to combat Coronavirus, while bonds found favour on expectations central banks would need to keep stimulus flowing to offset the likely economic drag, said a Reuters report.

Close

As the death toll reached 100 and the virus spread to more than 10 countries, including France, Japan and the United States, some health experts questioned whether China can contain the epidemic, it said.

The Nifty is now approaching to test the swing low of 12087 below which the psychological mark of 12000 will be the major support to watch out for, suggest experts.

The S&P BSE Sensex plunged more than 450 points while the Nifty50 saw a cut of more than 100 points on Monday.

Let’s look at the final tally on D-Street – the S&P BSE Sensex plunged 458 points to 41,155 while the Nifty50 dropped 129 points to close at 12,119.

The broader market outperformed as the S&P BSE Smallcap index closed flat with a positive bias while the S&P BSE Midcap index was down 0.4 percent.

Sectorally, the action was seen in the S&P BSE Healthcare index while profit-taking was seen in Metals, telecom, power, and banks. The NiftyBank fell 1.29 percent or more than 400 points at 30,837.

The rupee declined by 10 paise to settle at 71.43 against the US dollar on Monday, amid heavy selling in domestic equities following increasing concerns over spreading of coronavirus from China to other countries.

On the institutional front, FPIs were net sellers in Indian markets for Rs 438 cr, while the DIIs were net buyers for Rs 10 cr, provisional data showed.

Big News:

As many as 65 companies on the BSE are scheduled to report their results for December quarter that include names like Central Bank of India, Cummins India, Century Textiles, JK Lakshmi Cement, M&M Financial Services, Manappuram Finance, Maruti Suzuki, Sagar Cement, Tata Coffee, Wabco India etc. among others.

Maruti Suzuki: PAT likely to grow by 14% YoY

Cummins India: PAT likely to fall by 4% YoY

(All estimates are from Motilal Oswal)

Technical View:

Nifty formed a long bearish candle, broke below 50-Days MA placed at 12,124

Going forward, a close below 12087 (swing low of Jan 22), and also coincides the value of its 50-Day ema (12088) could trigger further selling

In case if Monday’s fall is just a reaction to global cues then Nifty shall remain stable in the next session and make an attempt to consolidate between 12087 – 12227 levels on Tuesday, suggest experts

Traders are advised to remain neutral and can consider a short side trade on a close below 12087 levels and look for a target of 11900, they say

Three levels: 12087, 12216, 12227

Stocks in news:

Housing Development Finance Corporation (HDFC), the country's largest housing finance company, on January 27 registered a whopping 296 percent year-on-year growth in standalone profit due to fair value gain after the merger of Gruh Finance with Bandhan Bank.

Liquor major United Spirits Ltd (USL) on January 27 reported an increase of 15.19 percent in consolidated net profit at Rs 232 crore for the third quarter ended December, 2019.

InterGlobe Aviation has beat the Street estimates as the company reported a massive jump in its third-quarter net profit on the back of increasing load factor and higher operating income. It has posted a 167.8 percent jump in its Q3FY20 consolidated net profit at Rs 496 crore against the CNBC-TV18 estimates of Rs 175 crore.

Technical Recommendations:

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

Bata India Limited| Buy |Target: 1940 | Stop-loss: 1780 | Return 5.7 %

Canara Bank| Sell January Futures |Target: 200 | Stop-loss: 220 | Downside 6.1 %

Punjab National Bank| Sell January Futures | Target: 56 | Stop-loss: 64 | Downside 8.9%

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.
First Published on Jan 28, 2020 08:28 am
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