Ahead of Market: 12 things that will decide stock action on Friday

Ahead of Market: 12 things that will decide stock action on Friday

NEW DELHI: Nifty‘s consolidation run continued to the third consecutive day as the headline index formed a bearish candle on the daily chart. The 50-pack bluechips underperformed the broader market as the rally continued in the midcap and smallcap space.

Ajit Mishra, VP – Research, Religare Broking said, “In absence of any major trigger, we may see further consolidation in markets. Meanwhile, the focus should be on position management. Nifty has the next major support around the 14,850-14,950 zone.”

“Nifty made a move towards the mentioned resistance zone of 15,245-15,315. Since the move was lacking strength, the selling started after testing the lower range of 15,245, which eventually resulted in a decent intraday profit booking. Now, although the market looks a bit tentative, it is nowhere close to the trend reversal or sell off. Rather, it needs to be construed as a minor profit booking only,” said Sameet Chavan, Chief Analyst-Technical and Derivatives, Angel Broking.

That said, here’s a look at what some of the key indicators are suggesting for Friday’s action:
US stocks slip on surprise rise in jobless claims

Wall Street’s main indexes fell on Thursday as investors resumed a shift out of big technology-related firms, while an unexpected rise in weekly jobless claims pointed to a fragile recovery in the labor market. The Dow Jones Industrial Average was down 267.75 points, or 0.85%, at 31,345.27, the S&P 500 was down 32.45 points, or 0.83%, at 3,898.88 and the Nasdaq Composite was down 153.32 points, or 1.10%, at 13,812.17.

European shares rise as mining stocks rally

European shares inched higher on Thursday as mining stocks tracked a jump in commodity prices and helped outweigh the impact from a clutch of disappointing earnings reports from companies including Airbus and Orange. The pan-European STOXX 600 fell 0.89% after rising 0.1%. Miners jumped 2.5% as copper prices surged to their highest in nearly a decade.

Tech View: Trend reversal unlikely till Nifty holds 15K
Nifty50 fell for the third straight day on Thursday, but managed to hold above its immediate support at 15,100-15,080. The 50-pack formed a bearish candle on the daily chart and continued to form lower highs and lows. Analysts ruled out any major correction in Nifty as long as it holds above 15,000 level. “Although Nifty looked a bit tentative, it is nowhere close to seeing a trend reversal soon. The recent selloff needs to be construed as minor profit taking. In the coming session, one needs to watch the 15,050-15,000 zone. The first sign of weakness would emerge only if Nifty50 convincingly breaches the 15,000 mark. On the flipside, the 15,175-15,250 range is seen as immediate hurdle,” said Sameet Chavan of Angel Broking.

Check out the candlestick formations in the latest trading sessions


F&O: India VIX moves up marginally
India VIX moved up marginally by 0.20% from 21.50 to 21.54 level. VIX now needs to cool down and hold below 20 level to continue the ongoing momentum with a higher market base. Put writing was seen at strike prices 15,100 and 15,000 while there was Call writing at 16,000 and then 15,300 levels. Options data suggested a wider trading range between 14,700 and 15,500 levels, while the immediate range was seen between 14,800 and 15,300 levels.

Stocks showing bullish bias
Momentum indicator Moving Average Convergence Divergence (MACD) on Thursday showed bullish trade setup on the counters of Bharat Heavy Electricals, GAIL (India), NBCC (India), HFCL, Coal India, Karnataka Bank, HUDCO, Tech Mahindra, Balrampur Chini, DCW, Asian Paints, Dwarikesh Sugar, Welspun India, SBI Cards and Payments, HCL Infosystem, BEML, Jain Irrigation, Zensar Technologies, Dewan Housing Finance Corporation, Ujjivan Financial, Mishra Dhatu Nigam, Suven Life Sciences, MOIL, MBL Infrastructures, Avadh Sugar & Energy, Uttam Sugar Mills, Century Enka, Vardhman Textiles, Simbhaoli Sugars and Wendt India.

Stocks signalling weakness ahead
The MACD showed bearish signs on the counters of DLF, HDFC Bank, Sun Pharmaceuticals, Shriram Transport Finance, Havells India, Grasim Industries, Sanghi Industries, Hindustan Zinc, Divi’s Lab, KCP, Olectra Greentech, Elgi Equipments, Inox Wind, Sunteck Realty, Persistent Systems, Solara Active Pharma, Supreme Industries, Ingersoll Rand, Vaibhav Global, VIP Clothing, P&G Health, Weizmann, Rushil Decor, TCI, Lakshmi Machines, Sharda Motor and Lakshmi Finance.

Thursday’s most active stocks
SBI (Rs 2813.84 crore), Bank of Baroda (Rs 2376.24 crore), RIL (Rs 1794.40 crore), ICICI Bank (Rs 1793.38 crore), GAIL (Rs 1648.57 crore), Tata Motors (Rs 1610.85 crore), PNB (Rs 1583.52 crore), Axis Bank (Rs 1523.85 crore), Bajaj Finance (Rs 1295.77 crore) and Bharti Airtel (Rs 1288.12 crore) were among the most active stocks on Dalal Street on Thursday in value terms.

Thursday’s most active stocks in volume terms
PNB (Shares traded: 36.51 crore), Bank of Baroda (Shares traded: 25.69 crore), Vodafone Idea (Shares traded: 19.76 crore), YES Bank (Shares traded: 17.27 crore), BHEL (Shares traded: 16.66 crore), Central Bank of India (Shares traded: 14.01 crore), Union Bank of India (Shares traded: 13.16 crore), GAIL (Shares traded: 11.47 crore), ONGC (Shares traded: 11.00 crore) and NBCC (Shares traded: 10.24 crore) were among the most traded stocks in the session.

Stocks showing buying interest
Central Bank of India, The New India Assurance, IOB, NBCC and Bank of Baroda witnessed strong buying interest from market participants as they scaled their fresh 52-week highs on Thursday signalling bullish sentiment.

Stocks seeing selling pressure
AKG Exim, Global Education, Jiya Eco-Products, Radha Madhav Corporation, Ravinder Heights, Sanwaria Consumer and Valiant Organics witnessed strong selling pressure in Thursday’s session and hit their 52-week lows, signalling bearish sentiment on these counters.

Sentiment meter favours bulls
Overall, market breadth remained in favour of bulls. As many as 277 stocks on the BSE 500 index settled the day in green, while 220 settled the day in red.

Podcast: Should you chase privatisation candidates? >>>
Domestic indices on Thursday fell for the third straight day, but their performances were not that bad when compared with a few Asian peers that ended up to 1.6 per cent lower for the day. Sensex declined 379 points while Nifty could barely hold above its crucial support level of 15,100, thanks to rising new Covid cases and firming up of crude oil prices. We spoke to Gaurav Dua of Sharekhan to understand his views on the market.

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