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Last Updated : Mar 11, 2020 09:20 AM IST | Source: Moneycontrol.com

Market Headstart: Nifty likely to find support near 10,300; next crucial support at 10,000

Trends on SGX Nifty indicate a negative opening for the index in India. The Nifty futures were trading lower by 107 points, or 0.98%, at 10,406 on the Singaporean Exchange around 08:00 hours IST.

This week started with a black Monday when investors lost about Rs 7 lakh crore in terms of market capitalisation in just one trading session. Both Sensex and Nifty slipped to a fresh 52-week low on March 9 amid rising fears of Coronavirus threatening to impact economic activity.

More than 100 countries are affected by the virus, taking the total infected cases to over 1.11 lakh globally with around 3,900 deaths. Italy, Iran, South Korea, etc. are hit the hardest by the virus.

Nifty is likely to find some support on March 11 around 10,300, and below that 10,000 will act as crucial support for Indian markets.

Close

Asian shares and Wall Street futures fell on Wednesday as growing scepticism about Washington’s stimulus package to fight the coronavirus outbreak knocked the steam out of an earlier rally, said a Reuters report.

Brent crude futures rose to $38.60 a barrel, while U.S. West Texas Intermediate (WTI) crude rose towards $35.33 a barrel, following a jump of over 8% the previous day.

Trends on SGX Nifty indicate a negative opening for the index in India. The Nifty futures were trading lower by 107 points, or 0.98 percent, at 10,406 on the Singaporean Exchange around 08:00 hours IST.

The crucial support for the index is placed at 10,294, and a breach of the same could take the index towards 10,000 levels, suggest experts.

The rupee on Monday slipped past the 74-level against the US dollar to settle at 74.14 (provisional), down 27 paise tracking heavy selling in the domestic equity market amid rising concerns over a coronavirus-led economic slowdown.

FIIs on March 9 net sold Rs 6,595.56 crore worth of shares, the biggest single-day outflow since November 3, 2017. They sold Rs 17,316 crore worth of shares so far in March, in addition to Rs 18,000 crore of selling in the previous two months.

Big News:

D-Street was covered with one color on the occasion of Holi 2020 and that was red, thanks to the fall in crude oil prices, rising cases of Coronavirus which is creating threatening to impact global growth, and a fall in US Treasury Yields.

Investors should gradually accumulate good stocks which are having a strong financial position, a strong balance sheet and a strong free cash flow generation as these stocks are generally not impacted too much and are consistent performer

How can investors take advantage of the fall? Ajit Mishra VP Research, Religare Broking suggest investing in L&T, Britannia Industries, Coromandel International, and Axis Bank.

Dyaneshwar Padwal – AVP- Technical Analyst at KIFS Trade Capital suggest investment in Jubilant FoodWorks, MindTree, and HDFC Life.

Technical View:

Nifty formed a bearish candle on the daily charts

If the index sustains above 10294 levels then a bounce can be expected towards 10750 levels.

In case if Nifty fails to hold on to the said level of 10294 then correction shall get extended towards 10,000 levels, suggest experts.

Considering the uncertain external environment it looks prudent on the part of traders to sit on the fence waiting for stability, they say.

Three levels to track include names like 10,294, 10,751, 11000

Max Call OI: 12000, 11300

Max Put OI: 10,000, 11000

Stocks in the news:

State-owned Union Bank of India on Monday announced reduction in its marginal cost of funds-based lending rate (MCLR) by 10 basis points across all tenors, effective March 11.

Software major Infosys on Monday announced the dismissal of three of its employees, attached to the Income Tax department's Centralised Processing Centre here, in the backdrop of their arrest on charges of taking bribes from tax-payers for speedy processing of their refund.

Muthoot Fincorp on Monday said it has raised Rs 125 crore through issuance of covered bonds. Covered bonds are debt securities issued by a bank or financial institution and collateralized against a pool of assets that in case of failure of the issuer, can cover claims at any point of time.

Technical Recommendations:

We spoke to HDFC Securities and here's what they have to recommend:

Aurobindo Pharma: Sell| LTP: Rs 471| Target: Rs 430|Stop-Loss: Rs 497| Downside 9%

HUL: Sell| LTP: Rs 2122| Target: Rs 2,000| Stop-Loss: Rs 2,190|Downside 6%

Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their 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 Mar 11, 2020 08:40 am
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