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Nifty Outlook

Markets traded in a narrow range on the weekly expiry day and ended almost unchanged, taking a breather after the recent surge. The benchmark opened marginally lower in early trades tracking feeble global cues and remained range bound till the end. Meanwhile, a mixed trend across the sectoral pack and buoyancy on the broader front kept the participants busy.

We’re in the fifth successive week of advance and rotational buying across sectors helping the index maintain the prevailing trend. We’re eyeing 18,100 in Nifty and reiterate our view to continue with the “buy on dips” approach. Participants should focus more on stock selection after the recent surge and focus more on the sectors/stocks which are trading in sync with the benchmark instead of focusing on laggards.

News

* Tata Power Renewable Energy, a wholly owned subsidiary of the Tata Power Company, approved the allotment of 8.36cr equity shares of the face value of Rs 10 each at a price of Rs 239.22/share (including a premium of Rs 229.22) aggregating to Rs 2,000cr on a preferential basis to Green Forest New Energies Bidco, a Company incorporated under the laws of England and Wales.

* Dilip Buildcon signs an EPC agreement worth Rs 1,400cr (excl GST) with Madhya Pradesh Jal Nigam Maryadit, Bhopal for the Entire Water Supply Scheme for 10 Years in the state of Madhya Pradesh. The completion period for the project is 28 months.

* Lupin announced that it has received approval from the USFDA for its ANDA, Rufinamide Tablets, approved for the treatment of seizures associated with Lennox-Gastaut Syndrome (LGS) in pediatric patients 1 year of age and older, and in adults. The product will be manufactured at Lupin’s facility in Goa, India.

Derivative Ideas

NIFTY gained 0.07% and closed at 17956.5 on 18th Aug. The index consolidated with positive bias on the weekly expiry day. NIFTY Futs saw good addition of longs with 17900 PE adding significant OI making 17800-17850 to look out for as support. We expect NIFTY to trade with positive bias in the range of 17800-18100 in the short term and thus suggest selling PE as per the given levels.

Strategy:- SELL NIFTY 25 AUG 17600 PE @48-50, STOP LOSS 70, TARGET 10.

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