The market ended lower for the second consecutive session on January 20, with the benchmark indices losing 0.4 percent. FMCG, auto, healthcare, metal and select technology stocks pulled the market down.
The Sensex fell 237 points to 60,622, while the Nifty declined 80 points to 18,028. The Nifty formed a bearish candle on the daily chart. It has been moving in the range to 300-400 points for three weeks, which experts say will at least continue till February 1 when the Budget 2023 will be presented.
"A reasonable negative candle was formed on the daily chart, which indicates a consolidation movement in the market. The Nifty is currently placed within a broad high low range of 18,200 to 17,900 levels and the specific direction is missing in the market," Nagaraj Shetti, Technical Research Analyst at HDFC Securities said.
He expects the choppy movement to continue in the short term. At the lower levels, 17,900-17,800 could be a support for the market and resistance is expected at 18,150-18,200 in the near term, he said.
The broader market has also remained under pressure, with the Nifty midcap100 index falling 0.8 percent and the smallcap100 index 0.6 percent.
We have collated 15 data points to help you spot profitable trades:
Note: The open interest (OI) and volume data of stocks in this article are aggregates of three-month data and not just of the current month.
Key support, resistance levels for the Nifty
As per the pivot charts, the key support for the Nifty is at 18,014, followed by 17,983, and 17,934. If the index moves up, the key resistance levels to watch out for are 18,112 followed by 18,143 and 18,192.
The Nifty Bank outperformed the benchmark and climbed 178 points to 42,507 on January 20, forming Doji pattern on the daily chart, which indicates buyers and sellers are indecisive about the trend.
The important pivot level, which will act as crucial support, is 42,396 followed by 42,315 and 42,184. On the upside, key resistance levels are 42,658, 42,739, and 42,870.
On the monthly basis, the maximum Call open interest (OI) is at 18,100 strike, with 1.27 crore contracts, which can act as a resistance for the January series.
This is followed by 19,000 strike, comprising 1.21 crore contracts, and 18,500 strike, with more than 95.26 lakh contracts.
Call writing is at 18,100 strike, which added 88.72 lakh contracts, followed by 19,000 strike, which added 70.64 lakh contracts, and 18,200 strike, which added 44.9 lakh contracts.
Call unwinding is seen at 17,500 strike, which shed 34,350 contracts, followed by 17,700 strike, which shed 19,650 contracts, and 17,000 strike, which shed 16,050 contracts.
On the monthly basis, the maximum Put OI is at 18,100 strike, with 77.39 lakh contracts. In fact, the maximum pain for the Nifty is at 18,100 strike where we have the most open options contracts - Call & Put.
This is followed by 17,800 strike where there are 64.58 lakh contracts and 18,000 strike where we have 63.23 lakh contracts.
Put writing is at 18,100 strike, which has added 42.24 lakh contracts, followed by 17,800 strike, which added 28.63 lakh contracts, and 17,700 strike, which added 23.92 lakh contracts.
Put unwinding is seen at 18,200 strike, which shed 2.73 lakh contracts, followed by 17,200 strike, which shed 1.85 lakh contracts, and 18,000 strike, which shed 1.68 lakh contracts.
A high delivery percentage suggests that investors are showing interest in these stocks. We have seen the highest delivery in Marico, Infosys, HCL Technologies, ICICI Lombard General Insurance, and TCS, among others.
An increase in OI, along with an increase in price, mostly indicates a build-up of long positions. Based on the OI percentage, on January 20 a long build-up was seen in 20 stocks, including Coforge, Marico, Godrej Consumer Products, Gujarat Gas, and Power Grid Corporation of India.
A decline in OI, along with a decrease in price, mostly indicates long unwinding. Based on the OI percentage, 65 stocks, including Polycab India, Vedanta, Cummins India, SBI Card, and L&T Finance Holdings, saw long unwinding on January 20.
An increase in OI, along with a decrease in price, mostly indicates a buildup of short positions. Based on the OI percentage, a short build-up was seen in 79 stocks, including Atul, Oberoi Realty, Hindustan Unilever, Dalmia Bharat, and HDFC Life Insurance Company.
A decrease in OI, along with an increase in price, mostly indicates short-covering. Based on the OI percentage, 25 stocks saw short-covering. These included Manappuram Finance, Coal India, IRCTC, Delta Corp and IndiaMART InterMESH.
Hi-Tech Pipes: Motilal Oswal Equity Opportunities Fund Series II bought 2 lakh shares in the company via open market transactions at an average price of Rs 937 a share. Motilal Oswal Business Advantage Fund Series II purchased 1 lakh shares at an average price of Rs 936.99 a share.
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Axis Bank, IDBI Bank, Canara Bank, Container Corporation of India, Amber Enterprises India, Craftsman Automation, Butterfly Gandhimathi Appliances, Gland Pharma, Gravita India, HFCL, Jammu & Kashmir Bank, Jindal Stainless, Poonawalla Fincorp, Route Mobile, Shoppers Stop, Syngene International, Tata Communications, Tamilnad Mercantile Bank, and Zensar Technologies will be in focus ahead of quarterly earnings on January 23.
Reliance Industries: The oil-telecom-to-retail major delivered strong operating performance for the quarter ended December FY23 with contributions from all segments. Its consolidated profit (excluding the impact of exceptional item) grew 0.6 percent YoY to Rs 17,806 crore for Q3FY23 and EBITDA grew 13.5 percent YoY to Rs 38,460 crore backed by strong growth in subscriber base and 17.5 percent increase in ARPU (average revenue per user) in the digital services segment. Gross revenue at Rs 2.4 lakh crore increased by 14.8 percent YoY, supported by continuing growth momentum in consumer businesses.
ICICI Bank: The country's second-largest private sector lender recorded a 34.2 percent year-on-year increase in standalone profit at Rs 8,312 crore for the quarter ended December FY23 on healthy growth in NII and operating profit, with improvement in asset quality. Net interest income surged 34.6 percent to Rs 16,465 crore from the year-ago period with net interest margin expanding 69 bps YoY to 4.65 percent for the quarter. Profit and NII were ahead of analysts' estimates. Credit growth was 19.7 percent and deposits increased by 10.3 percent compared to the year-ago period.
Kotak Mahindra Bank: The private sector lender reported a 31 percent year-on-year growth in standalone profit at Rs 2,792 crore for the quarter ended December 31, 2022 despite higher provisions, backed by healthy operating profit, other income and NII growth, with an improvement in asset quality. Net interest income for the quarter jumped 30.4 percent to Rs 5,653 crore, with 85 bps YoY expansion in net interest margin at 5.47 percent. Deposits for the quarter grew by 13 percent and advances increased by 23 percent from the year-ago period.
UltraTech Cement: The Aditya Birla Group-owned cement company reported a 38 percent year-on-year decline in consolidated profit at Rs 1,058.2 crore for the December quarter, hit by weak operating margin. It reported an increase in raw material cost, power & fuel cost and freight & forwarding expenses YoY. Consolidated revenue from operations increased 19.5 percent to Rs 15,521 crore for the quarter YoY.
IDFC First Bank: The bank clocked a 115 percent year-on-year growth in standalone profit at Rs 604.6 crore for the December FY23 quarter despite higher provisions, supported by strong other income, operating profit and NII and asset quality improvement. Net interest income at Rs 3,285.3 crore grew 27.3 percent compared to the year-ago quarter.
Yes Bank: The private sector lender saw an 80.7 percent year-on-year decline in standalone profit at Rs 51.5 crore for the quarter impacted by ageing related provisions but supported by higher other income and operating profit with improvement in asset quality. Net interest income grew 11.7 percent to Rs 1,970.6 crore for the quarter YoY, with net interest margin rising 10 bps YoY (down 10 bps QoQ) to 2.5 percent. Advances for the quarter grew by 10 percent and deposits growth stood at 16 percent compared to the corresponding period of the last fiscal.
RBL Bank: The bank reported a 34 percent year-on-year increase in profit at Rs 209 crore for the December quarter on fall in provisions with an improvement in asset quality. Net interest income at Rs 1,148 crore rose 13.6 percent from the year-ago period, with the net interest margin expanding 40 bps YoY to 4.74 percent. Advances for the quarter at Rs 66,684 crore were up 15 percent and deposits grew by 11 percent with CASA deposits rising 18 percent.
Tanla Platforms: The cloud communications company recorded a 26.3 percent year-on-year decline in profit at Rs 116.5 crore in the December quarter, dented by lower top line and weak operating performance. Revenue at Rs 869.6 crore fell by 1.7 percent and EBITDA tanked 25 percent to Rs 151.4 crore with the margin down 550 bps from the year-ago period.
Bandhan Bank: The private sector lender's profit declined 66 percent year-on-year to Rs 290.6 crore in the December quarter, dented by higher provisions and lower growth in net interest income. Net interest income fell 2 percent YoY to Rs 2,080.4 crore, with 130 bps drop in net interest margin at 6.5 percent. The loan book grew by 11.1 percent and deposits rose by 21 percent YoY.
LTIMindtree: The IT services company recorded a 16 percent sequential fall in profit at Rs 1,001 crore for the December quarter, with EBITDA at Rs 1,374.8 crore declining 16 percent QoQ and margin dropping nearly 4 percentage points QoQ to 15.95 percent. Revenue grew by 4.8 percent sequentially to Rs 8,620 crore, with dollar revenue growth at 2.4 percent and constant currency revenue growth at 1.9 percent for the quarter.
Foreign institutional investors (FII) net sold shares worth Rs 2,002.25 crore, whereas domestic institutional investors (DII) net bought shares worth Rs 1,509.95 crore on January 20, as per the provisional data available on the NSE.
Stocks under F&O ban on NSE
The National Stock Exchange added PVR and retained Delta Corp and L&T Finance Holdings under its F&O ban list for January 23. Securities banned under the F&O segment include companies where derivative contracts have crossed 95 percent of the market-wide position limit.
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