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Nifty Outlook

Markets settled marginally lower in a volatile trading session amid mixed cues. Firm global cues triggered a gap-up start however profit taking in the index majors from across sectors dragged the indices lower. Consequently, the Nifty index ended with losses of 0.3% to close at 16,584.30 levels. All the sectoral indices, barring IT, ended lower wherein realty, banks, and auto were the top losers.

The recovery in the global indices combined with bargain hunting on the domestic front has helped the index to witness a rebound recently. However, this move lacks decisiveness due to lingering issues like inflation, geopolitical tension, etc. We recommend booking profit on the rise citing a strong hurdle at 16,900 in Nifty and waiting for further clarity. Stocks, on the other hand, are offering opportunities on both sides so traders should align their positions accordingly. Going ahead, apart from the global cues, the upcoming RBI monetary policy meet and monsoon progress will be in the focus for cues.

News

* Suryoday Small Finance bank, one of India’s leading small finance bank, announced its partnership with Mobisafar to provide banking services through all Mobisafar’s franchisees and Business Correspondent networks across India.

* Inox Wind Limited completes allotment of equity shares and convertible warrants worth Rs. 402.5 cr wherein the promoters infused Rs. 150 cr through preferential issue of equity shares.

* Adani Ports & SEZ witnessed strong business activity in May as it witnessed a YoY growth of 4% in the cargo volume at 30.37 MT. Coal volumes also rose 6 % YoY aided by both the thermal and coking coal volumes.

Derivative Ideas

COLPAL shed 1.69% and closed at 1562.8 on 3rd Jun. The stock has been facing hindrance going higher. Recently the stock had broken and started trading below its important support at 1600 that too with incremental volumes and addition of Shorts in its FUTS. Trading below its 50 day EMA, the stock is likely to witness further pressure. We thus suggest initiating Shorts in FUTS as per the recommended levels.

Strategy:- SELL COLPAL FUTS @1580-1585, SLOSS AT 1605, TRGT 1510.

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