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After two days of decline and a fall below crucial short-term moving average, the Nifty managed to bounce back on Wednesday and close above its crucial resistance level of 10,770, making a 'Harami' pattern on the daily charts.
Formation of a bullish candle after a large bearish candle suggests that the trend may be reversing. The smaller candle is usually located within the vertical range of the larger body. However, the pattern will only get confirmed if the bullishness continues in Thursday's trade as well. The Nifty should sustain above 10,700 for the bulls to remain in control.
Investors are advised to remain cautious and watch trading activity carefully over the next few sessions. A slip below 10,698 could result in the downtrend resuming, while a close above 10,840 could tilt the trend upward.
The Nifty, which opened at 10,734, rose to an intraday high of 10,781 on Wednesday. It slipped marginally to hit an intraday low of 10,724, before ending the day at 10,772, up 61 points.
The Bank Nifty erased the losses made over the last three sessions and closed above its immediate hurdle of 26,500. It formed a strong bullish candle after the weakness of the last four sessions, and now it has to hold above 26,500 to witness an up move towards 26,750, suggest experts.
According to Pivot charts, the key support level is placed at 10,736.73, followed by 10,701.47. If the index starts moving upwards, key resistance levels to watch out are 10,794.53 and 10,817.07.
The Nifty Bank index closed at 26,557.7 on Wednesday. The important Pivot level, which will act as crucial support for the index, is placed at 26,386.8, followed by 26,215.9. On the upside, key resistance levels are placed at 26,651.71, followed by 26,745.7.
Stay tuned to Moneycontrol to find out what happens in currency and equity markets today. We have collated a list of important headlines from across news agencies.
US markets end mixed, Nasdaq closes at record high
US markets ended the day yesterday mixed with the Nasdaq Composite closing at a record high and the Dow trapped in its longest losing streak since March 2017 as US trade concerns lingered.
The Dow Jones Industrial Average declined 0.2 percent to 24,657.80, its seventh consecutive decline while the Nasdaq jumped 0.7 percent to close at a record high of 7,781.52.
Asian shares subdued amid lull in trade spat
Asian shares were subdued on Thursday as a lull in the Sino-US trade tussle helped calm nerves enough for the Nasdaq to reach a record high, while tensions in the oil market grew ahead of an OPEC meeting that may expand crude supply.
MSCI's broadest index of Asia-Pacific shares outside Japan was 0.05 percent firmer, while Japan's Nikkei edged up 0.12 percent in thin trade.
SGX Nifty
Trends on SGX Nifty indicate a flat to positive opening for the broader index in India, a rise of 9.5 points or 0.09 percent. Nifty futures were trading around 10,802-level on the Singaporean Exchange.
RBI MPC meet minutes: Common man seems to be experiencing inflationary pressure
Rising inflation hitting the common man and uncertainty in markets across the globe were the primary reasons behind the Reserve Bank of India decision to raise interest rates in its latest monetary policy review.
"There is no alternative to raising the policy rate by 25 bps so as to signal concern about underlying inflation, manage inflation expectations, and guard proactively against a further increase in inflation," RBI Deputy Governor Viral Acharya was quoted as saying in the minutes of the MPC meet that were released on Wednesday. The deputy governor also said that it was only the uncertainty surrounding oil and food prices, and the way financial markets and trade wars between nations are playing out that led him to keep the stance neutral.
Bank of England to keep rates steady, markets look for August hint
The Bank of England may lay some groundwork on Thursday for an August interest rate rise, if it judges the economy is now turning a corner after an unusually weak start to the year.
No economists polled by Reuters expect the BoE to raise rates when it announces its June policy decision at 1100 GMT, and markets are split over whether the BoE’s next rate rise - which would be just its second since the financial crisis - will come at its next meeting in August, or only later in 2018.
Rupee takes U-turn, jumps 30 paise to 68.08 a dollar
The beaten-down rupee yesterday staged a good comeback, recuperating by a sharp 30 paise to end at 68.08 against the US currency on heavy bouts of dollar selling by banks and exporters with equities gaining ground.
The Indian unit had tumbled to near one-month low of 68.38 on Tuesday on fears of knock-on effects from renewed trade tensions between the US and China. In the cross currency trade, the rupee edged higher against the pound sterling to finish at 89.72 per pound from 89.96 and rebounded against the euro to settle at 78.74 from 78.97.
India's May trade deficit widens to $14.62 bn: Trade ministry
India's merchandise exports in May rose 20.2 percent year-on-year, the trade ministry said on Friday, but the trade deficit widened to USD 14.62 billion, driven mainly by a 50 percent surge in its oil import bill, on higher global prices.
Merchandise exports last month rose to USD 28.86 billion from a year ago, while imports rose 14.85 percent on year to $43.48 billion, the Ministry of Commerce and Industry said in a statement.
SEBI board to meet today, amendments to buyback, takeover norms on agenda
SEBI is likely to discuss proposed overhaul of governance norms for market infrastructure institutions as well as amendments to buyback and takeover norms today, a senior official said. Other proposals, including reducing the cooling off period for former employees to one year and review of the watchdog's recruitment policy, are also on the agenda.
SEBI board will meet today in Mumbai where the proposal for overhauling regulations for ownership and governance of market infrastructure institutions (MIIs), including capping the tenure of chief executives of stock exchanges, are expected to be discussed, the official said.
Oil prices dip as Iran signals support for small OPEC supply increase
Oil prices dipped on Thursday as Iran signalled it could be won over to a small rise in OPEC crude output, likely paving the road for the producer cartel to agree a supply increase during a meeting on June 22.
Brent crude futures were at USD 74.55 per barrel down 19 cents, or 0.3 percent, from their last close. US West Texas Intermediate crude futures were at USD 65.63 a barrel, down 8 cents.
Dollar buoyant near 11-month highs
The dollar hovered near an 11-month high against a basket of currencies on Thursday, supported by a rise in US yields, while the pound struggled at its lowest level since November 2017 ahead of Bank of England’s monetary policy decision.
The dollar index against a group of six major currencies stood at 95.11 after rising to 95.299 overnight, its highest since mid-July 2017. Buoying the greenback, long-term Treasury yields bounced back from three-week lows on Wednesday as risk aversion that took hold earlier in the week amid the US-China trade tensions eased for now.
CEA Arvind Subramanian to move back to the US in Sept
Chief Economic Adviser Arvind Subramanian will get back to research and academics again in the US in September this year, leaving behind a rich policy footprint in areas of taxation, banking, and financial inclusion, among others.
Addressing the press, Subramanian on Wednesday said that he will return back to the US for ‘personal reasons’—to a life of researching, writing, teaching and reflecting. “This is the best job I have ever had and probably ever will,” he told the reporters, adding that the last date for his role as the CEA is yet to be fixed.
FIIs invest a meagre $15 mn so far this year; DIIs pour $7.9 bn: Report
FII flows have seen a bumpy ride so far this year, with a meagre investment of USD 15 million, while domestic institutional investors (DIIs) continue to invest more aggressively into the Indian equity market and have bought net assets worth USD 7.9 billion, says a Morningstar Investment Adviser report.
"The flows for this year in the first six months is negligible compared to last year during the same period. While last year FIIs invested net assets worth USD 8 billion in the first six months, this year the figure is a meagre USD 15 million until June 12, 2018. So, this year has been extremely unfavourable from FII flow perspective," said the report.
IPOs to raise Rs 35,000 cr in 2018: Report
After a blockbuster 2017, the primary market is expected to remain robust in 2018 with Dalal Street looking at over Rs 35,000 crore of IPOs, a significant proportion of which are PE-backed, says an EY report.
"The initial public offer market is expected to remain robust in 2018 due to the resilient nature of the economy and strong domestic liquidity. The IPO pipeline is healthy with dozens of companies looking to go public raising over Rs 35,000 crore through the year," EY said yesterday.
Fine Organic Industries IPO subscribed 12% on Day 1
The initial public offer of Fine Organic Industries has been subscribed 12 percent so far on the first day of bidding on Wednesday. The Rs 600-crore IPO has received bids for 6.2 lakh shares against the total issue size of 53.65 shares (excluding anchor investors' portion), data available with the NSE till 5 pm showed.
Price band for the issue has been fixed at Rs 780-783 per share. JM Financial and Edelweiss Financial Services are book running lead manager for the issue. Karvy Computershare is registrar to the issue. The company's shares are proposed to be listed on BSE and the NSE.
RITES IPO subscribed 0.6 times on Day 1
The initial public offer of RITES has been subscribed 0.60 times so far on the first day of bidding on Wednesday. The IPO to mop-up Rs 466 crore received bids for 1.5 crore shares against the total issue size of 2.52 shares, data available with the NSE till 5 pm showed.
Price band for the issue has been fixed at Rs 180-185 per share. Elara Capital India, IDBI Capital Markets & Securities, SBI Capital Markets and IDFC Bank are book running lead managers to the issue. Link Intime India is the registrar. The company's shares are proposed to be listed on BSE and the NSE.
4 stocks under ban period on NSE
Securities in ban period for the next day's trade under the F&O segment includes companies in which the security has crossed 95 percent of the market-wide position limit.
For June 21, 2018, DHFL, Jet Airways, Infibeam and JP Associates are present in this list.
With inputs from Reuters & other agencies
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