Bears further tightened their grip over Dalal Street, dragging the benchmark indices significantly lower for the third day consecutive day on March 13. The turmoil in the US banking space with the collapse of Silicon Valley Bank and the closure of Signature Bank weighed down the market.
The selling was seen across sectors with major correction in banking & financial services, auto and realty stocks.
The BSE Sensex tanked 897 points or 1.52 percent to 58,238, while the Nifty50 plunged 259 points or 1.5 percent to 17,154, the lowest closing level since October 13 last year, and formed a big bearish candlestick pattern on the daily charts.
"The market broke all-important support levels and closed below the 17,250 level, which is negative. However, on the downside, the Nifty has major support between 17,000 and 16,900 levels," Shrikant Chouhan, Head of Equity Research (Retail) at Kotak Securities said.
On the upside, the analyst feels the index will find resistance at the 17,250 and 17,450 levels.
Investors can use the strategy to sell at 17,350 and 17,400 with a stop-loss at 17,450. On the other hand, traders can buy between 17,000 and 16,900 levels with a stop-loss at 16,800, the market expert advised.
The broader markets also reeled under heavy selling pressure, with the Nifty Midcap 100 and Smallcap 100 indices declining around 2 percent each on weak breadth. India VIX, the volatility index, spiked nearly 21 percent to 16.21 levels, indicating heightened volatility in the market.
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 the aggregates of three-month data and not just the current month.
Key support and resistance levels on the Nifty
As per the pivot charts, the Nifty has support at 17,107, followed by 17,008 and 16,849. If the index moves up, the key resistance levels to watch out for are 17,425, followed by 17,523 and 17,682.
All banking stocks corrected, dragging the Bank Nifty down by 921 points or 2.3 percent to 39,565, the lowest closing level in the last five-month and the new low of 2023. The index has formed a large bearish candlestick pattern on the daily charts, making lower highs and lower lows for the second consecutive session.
"The index remains in a sell-on-rise mode with strong resistance at 41,000 where aggressive Call writing has been observed. The index's immediate support stands at 39,500 and can witness a pullback rally if it manages to hold it," Kunal Shah, Senior Technical & Derivatives Analyst at LKP Securities said.
The important pivot level, which will act as a support, is at 39,431, followed by 39,140 and 38,668. On the upside, key resistance levels are 40,375, followed by 40,667, and 41,139.
On a weekly basis, we have seen the maximum Call open interest (OI) at 17,500 strike, with 1 crore contracts, which may remain a crucial hurdle on the higher side, for the Nifty in the coming sessions.
This is followed by an 18,000 strike, comprising 88.03 lakh contracts, and a 17,700 strike, where there are more than 88.03 lakh contracts.
Call writing was seen at 17,300 strike, which added 40.26 lakh contracts, followed by 17,200 strike, which gave an addition of 29.64 lakh contracts, and 17,400 strike which saw 25.94 lakh contracts addition.
We have seen Call unwinding at 18,000 strike, which shed 13.35 lakh contracts.
On a weekly basis, the maximum Put OI was seen at 17,000 strike, with 45.37 lakh contracts, which is expected to act as a crucial support zone for the Nifty50 in coming sessions.
This is followed by the 16,800 strike, comprising 37.29 lakh contracts, and the 17,400 strike, where we have 36.48 lakh contracts.
Put writing was seen at 16,800 strike, which added 12.76 lakh contracts, followed by 16,900 strike with 12.16 lakh contracts, and 16,700 strike with 9.31 lakh contracts.
We have seen Put unwinding at 17,400 strike, which shed 23.86 lakh contracts, followed by 17,300 strike which shed 22.76 lakh contracts, and 17,500 strike which shed 9.1 lakh contracts.
Stocks with high delivery percentage
A high delivery percentage suggests that investors are showing interest in these stocks. The highest delivery was seen in Dabur India, Godrej Consumer Products, Astral, United Spirits, and Berger Paints, among others.
An increase in open interest (OI) and an increase in price mostly indicate a build-up of long positions. Based on the OI percentage, 3 stocks - Tech Mahindra, ICICI Lombard General Insurance Company, and Britannia Industries - witnessed a long build-up.
In most cases, a decline in OI and a decrease in price indicate a long unwinding. Based on the OI percentage, 101 stocks including GAIL India, Power Grid Corporation of India, ABB India, Gujarat Gas, and Siemens witnessed a long unwinding.
83 stocks see a short build-up
An increase in OI accompanied by a decrease in price mostly indicates a build-up of short positions. Based on the OI percentage, 83 stocks including Ipca Laboratories, AU Small Finance Bank, IndusInd Bank, Navin Fluorine International, and IndiaMART InterMESH, saw a short build-up.
A decrease in OI along with an increase in price is an indication of short-covering. Based on the OI percentage, five stocks were on the short-covering list. These are Mahanagar Gas, Dr Lal PathLabs, Balrampur Chini Mills, United Spirits, and Apollo Hospitals Enterprises.
Mahindra CIE Automotive: Promoter entity Mahindra & Mahindra sold 2.29 crore equity shares in the company via open market transactions at an average price of Rs 357.39 per share, however, Societe Generale acquired 64.53 lakh equity shares in the company at an average price of Rs 357.
Mahindra Logistics: First Sentier Investors ICVC-SI Asia Pacific Sustainability Fund sold 6.46 lakh equity shares in the company at an average price of Rs 366.23 per share, and 6.04 lakh shares at an average price of Rs 366.11 per share.
Sona BLW Precision Forgings: Singapore VII Topco III Pte Ltd exited Sona Comstar by selling entire 11.99 crore equity shares at an average price of Rs 410.04 per share. However, HDFC Mutual Fund, ICICI Prudential Life Insurance Company, Societe Generale, BNP Paribas Arbitrage, Fidelity Investment Trust Fidelity Series Emerging Markets Fund, Fidelity Asian Values Plc, Government of Singapore, and Monetary Authority of Singapore bought 6.53 crore equity shares in the company, at an average price of Rs 410 per share.
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Investors' meetings on March 14
Infosys: Company's officials will participate in HDFC Securities IT sector Conference.
HCL Technologies: Officials of the company will participate in non-deal roadshow in USA, hosted by Jefferies.
Alkem Laboratories: Company's officials will meet Ampersand Capital.
Allcargo Logistics: Officials of the company will meet investors and analysts in non-deal roadshow organized by Jefferies.
Bharti Airtel: Company's officials will meet analysts and institutional investors.
Stocks in the news
Krsnaa Diagnostics: Krsnaa Diagnostics said it has operationalised 100 more Pathology Collection Centers to provide services of Lab Investigation Facilities under Hinduhridaysamrat Balasaheb Thackeray Chikitsa for BMC Dispensaries and Hospitals in Mumbai. With this, the Company has operationalized 300 Pathology collection centres as of date.
Dhanlaxmi Fabrics: The company said it will be shutting its processing unit at Dombivali for 6-8 months as the 30-year-old factory need to go for a major renovation. The renovation work will start on April 1. However the Weaving Unit of the Company located at Kolhapur will remain in operation, it said.
GAIL India: GAIL declared Interim Dividend for FY23 of 40 percent on the paid-up Equity Share Capital, which is Rs 4 per equity share. The Total Dividend amount will be Rs 2,630 crore with a record date of March 21st, 2023. Based on current shareholding of Government of India (51.52%), dividend of Rs 1,355 crore shall be paid to Government of India, while other shareholders will receive Rs 1,275 crore.
Tata Chemicals: Fitch Ratings revised the outlook on the Company’s Long-Term Foreign-Currency Issuer Default Rating (IDR) to Positive from Stable and affirmed the rating at 'BB+'.
Lupin: United States Food and Drug Administration (USFDA) has completed an inspection of Lupin's Bioresearch Centre in Pune, India. Lupin Bioresearch Centre conducts BA/BE, PK/PD, In-vitro BE and biosimilar studies. The inspection closed without any observation. The Centre has successfully undergone its seventh consecutive onsite inspection.
Sun TV Network: The Board of Directors of Sun TV at their meeting held on 13th March 2023, inter alia, have declared an interim dividend of Rs 2.50 per equity share for the financial year 2022-23.
Surya Roshni: The company said it has obtained total order amounted to Rs 96.39 crore for supply 3LPE Coated steel pipes from Hindustan Petroleum Corporation Limited for City Gas Distribution (CGD) projects in three geographical areas in the state of Rajasthan, Bihar, Jharkhand and West Bengal. The order is to be executed within 8.5 months.
BL Kashyap and Sons: The company has secured new orders from domestic unrelated clients aggregating to Rs 158 crore. This includes construction of Business Park Campus at Bengaluru worth Rs 89 crore excluding GST and construction of Residential Complex at Bengaluru worth Rs 69 crore excluding GST. These projects are expected to be completed within 24 months approximately from the date of award. The current order book of the company stands at Rs 2,089 crore.
Fund Flow
Foreign institutional investors (FII) sold shares worth Rs 1,546.86 crore, whereas domestic institutional investors (DII) bought shares worth Rs 1,418.58 crore on March 13, the National Stock Exchange's provisional data showed.
Stocks under F&O ban on NSE
The National Stock Exchange has retained GNFC in its F&O ban list for March 14. 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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