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Nifty Outlook

Markets resumed the corrective trend and lost nearly one and a half percent. Weak global cues triggered a gap down start, followed by range bound session till the end. The Nifty index finally ended with losses of 1.5% to close at 16,411 levels. Amongst the sectors, except Power, all the other indices ended with losses wherein Realty, Metal and Consumer Durables ended were the top losers. The broader indices also lost in the range of 1.5%-2%.

Markets will react to Reliance numbers in early trade on Monday and then focus would shift to the global cues. The increasing fear of aggressive rate hikes from the US Fed has spooked investors across the globe including India. On the index front, the Nifty has tested the crucial support zone of 16,400 and indications are in the favour of prevailing decline to continue with some intermediate pause/rebound. In case of any rebound, the 16650-16800 zone would act as a hurdle. Participants should align their positions accordingly and use rebound to create shorts.

News

SJVN has bagged its first ever 30 MW Wind-Solar Hybrid project through a tender floated by Solar Energy Corporation of India Limited. The project was bagged at Rs 2.54/Unit on Build, Own and Operate basis in the Tariff based competitive bidding process.

Federal Bank reported its Q4FY22 numbers wherein NII was up 7.4% YoY to Rs. 1,525 cr. Its net profit grew by 13.1% to Rs. 541 cr as against Rs. 478 cr in the same quarter last year. Gross NPA stood at 2.8% and Net NPA at 0.96%.

Zydus Lifesciences subsidiary Zydus Worldwide DMCC has received tentative approval from the USFDA to market Selexipag Tablets in the strengths of 200 mcg, 400 mcg, 600 mcg, 800 mcg, 1,000 mcg, 1,200 mcg, 1,400 mcg, and 1,600 mcg.

Derivative Ideas

In spite of the correction in the market, HEROMOTOCO has surged strongly today i.e 6th May supported with a noticeable rise in volume. It has also surpassed its resistance hurdle of long term moving averages on daily charts and closed above the same. Considering the chart pattern with Fresh Longs added in its FUTS, we expect more upside going further. We thus suggest initiating Longs with the CE option as per the given levels. Strategy:-

BUY HEROMOTOCO 2600 CE @ 45-50, SLOSS AT 20, TRGT 100.

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