IGI Logo

Indian markets could open flat, following mildly negative Japan and Australia markets – the only two Asian markets open today, and flat US markets on Thursday - HDFC Securities 

U.S. stock indexes mostly closed slightly higher Thursday, with the S&P 500 index and Nasdaq Composite posting new records, even as investors saw a stubbornly high level of jobless benefit claims in the latest week, underlining the ongoing challenges to the U.S. economic recovery.

As for the Nasdaq, the tech-heavy index was pulled higher by semiconductor stocks, with the iShares PHLX Semiconductor ETF (SOXX) up 3.5%. A chip shortage may lift prices of the components. Still, all three major benchmarks are on track for gains this week and for February to date, with the small-cap Russell 2000 outpacing the S&P 500 for the week, the month and year.

A weekly report from the Labor Department showed that U.S. initial jobless claims in states fell to 793,000 (vs 760,000 expected) but new claims from two weeks ago were raised to 812,000 in early February, leaving the job market showing little improvement.

Bank of New York Mellon advanced after saying it had formed a new unit to help clients hold, transfer and issue digital assets, sending Bitcoin to an all-time highof $48,481. Mastercard also rose after the credit-card company said it was planning to offer support for some cryptocurrencies on its network this year, joining a string of big-ticket firms that have pledged similar support.

India’s consumer prices for January are expected to have risen 4.4%, according to the median estimate in a Bloomberg survey before data to be published Friday.

That would be the second month within the RBI’s range after December’s 4.59% increase. In early trading on Friday Asian markets were slipping a bit as investors looked over mixed data and watched for the next catalyst. Markets in Greater China and most of Southeast Asia are closed on Friday for the Lunar New Year holiday. Indian benchmark equity indices closed higher on February 11 after consolidating in the previous two sessions.

Nifty opened lower but quickly rose in the first half hour of trade and later remained in a range. At close, the Nifty was up 66.80 points or 0.44% at 15,173.30. Nifty rose mildly on Feb 11 after a sideways move on the previous two sessions. It could remain in the 15064-15257 band in the near term and a breakout either side could see action in that direction.

Daily Technical View on Nifty

Observation: Markets ended with healthy gains on Thursday after a quiet morning session. Buying momentum picked up in the late afternoon session. The Nifty finally gained 66.8 points or 0.44% to close at 15,173.3. Broad market indices like the BSE Small Cap index gained more, thereby out performing the Sensex/Nifty. Market breadth was positive on the BSE/NSE.

Zooming into the Nifty 15 min charts, we observe that the Nifty opened on a weak note and then traded in a range with the 50 period moving average providing support. A spurt of buying in the last one hour of trade on the back of above average volumes helped the Nifty to close above the recent intraday highs and also above the 20 period moving average.

The strength seen in the late afternoon session could therefore carry over in the very near term. On the daily chart, we can observe that the Nifty remains in a comfortable uptrend and well above its 20 day and 50 day SMA. Short term momentum indicators like the 14-day RSI too are in uptrend and at 69.36 is not yet in overbought terrirory. While there could be corrections in the very near term, we expect the index to make new life highs in the coming sessions

It is important that the Nifty does not move below the support of 14864 on any corrections for the short term uptrend to remain intact.

Conclusion: The 1-2 day trend of the Nifty remains up with the Nifty clearing its recent intraday highs. Nifty is likely to test the 15300 levels in the very near term. Our 7-day view on the market too remains bullish as the Nifty remains in a strong uptrend on the daily chart. Our bullish bets for the next 7 sessions would be off if the Nifty moves lower and closes below the 14864 levels.

To Read Complete Report & Disclaimer Click Here

Please refer disclaimer at https://www.hdfcsec.com/article/disclaimer-1795

SEBI Registration number is INZ000171337

Views express by all participants are for information & academic purpose only. Kindly read disclaimer before referring below views. Click Here For Disclaimer