Weekly Outlook on Nifty, Banknifty and USDINR By Mr. Anuj Gupta, IIFL Securities
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Below are Views on Nifty, Bank Nifty and USDINR Outlook By Mr. Anuj Gupta, Vice President, IIFL Securities
Last week the nifty corrected by 2.35% and closed at 17604 levels however the banknifty corrected by 5.09% and closed at 40345 levels. This selling pressure came after the release of the Hindenburg Research report that alleged a ‘fraud’ on Adani companies overall. Seven of Adani companies lost more than 3 lakh crore market-cap. Adani shares were in the line of the correction following the Hindenburg report accusing the group of serious irregularities. Eight listed companies of the Adani conglomerate lost more than 3 Lakh Cr market capitalization.
The FIIs have been on a selling spree this month, taking the total outflow in equities to ?16,766 crore in January. On Friday, Foreign Institutional Investors (FIIs) net sell was ?5,977.86 crore while DIIs net buy stood at ?4,252.33 crore.
Nifty is trading at 14 week's low levels and it also breached the strong support zone of 17900 to 17700 levels. Now nifty has a next strong support level of 17300 levels and then 17000 levels while resistance at 17900 levels and 18250 levels. Banknifty has a strong support at 41500 levels and then 40400 levels while resistance at 41000 levels and then 41800 levels. The India equity market is looking at a negative zone so very short term we are expecting that the nifty may test 17300 to 17200 levels, while bank nifty may test 41500 to 41300 levels in the next week.
Positive results of banking and auto sectors are supportive for the market so we are not expecting major correction in the market, so trades can go buy on support levels.
Rupee depreciated last week by 0.45% and closed at 81.68 levels. Weakness in the Indian equity market put pressure on india rupee, however weakness in dollar curb the sharp depreciation in rupee. India's foreign exchange reserves increased by $1.727 billion to $573.727 billion in the week ended January 20, the Reserve Bank of India said on Friday.
For the next week rupee has a support at 81.20 and then 80.70 levels while resistance at 81.90 levels and then 82.30 levels. Traders can go to sell dollars on rise and it is expected that it may test 81 levels very soon.
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