IGI Logo

Market Update

Nifty : 24,414.40 +34.80 (+0.14%)

Sensex : 80,746.78 +105.71 (+0.13%)

* The equity benchmarks, Sensex and Nifty, closed slightly higher in a volatile session after India launched missile strikes on terrorist hideouts in Pakistan and Pakistan-Occupied Kashmir.

* However, Nifty managed to recover nearly 1% or 200 points from its intra-day low, driven by a rise in US Index Futures (up over 0.5%) following news of a potential trade deal between the US and China, anticipation of the US Fed's rate decision today, strong foreign institutional investor (FII) buying interest, the India-UK Free Trade Agreement (FTA), and positive quarterly earnings that boosted market sentiment.

* Nifty gained 34 points (0.14%) to close at 24,414, after touching an intra-day low of 24,220. Meanwhile, Sensex ended 105 points (0.13%) higher, closing at 80,746. Despite geopolitical tensions, mid-cap, small-cap, realty, auto, and metal stocks posted solid gains of 1-2%.

* Textiles, auto, and auto ancillary stocks saw a sharp rally due to the India-UK FTA deal. Stocks like Welspun Living, KPR Mills, Tata Motors, Endurance Technologies, and Vardhman Textiles gained between 5-12%.

* The Nifty Metal Index rose by 1% after China reduced its policy rate and reserve ratio, and in anticipation of a US-China trade deal. Tata Steel, National Aluminum, SAIL, and NMDC each gained 2%.

* Globally, Asian markets saw gains, and US equity-index futures rose as discussions of trade negotiations between China and the US took center stage, ahead of the US Fed's interest rate decision.

Technical Outlook:

* Nifty Index opened negative by around 150 points on account of geopolitical concerns but witnessed a sharp uptick to 24450 zones in the first tick. It was followed by volatility and cool off in the first hour itself but again saw a gradual up move throughout the session. It formed a bullish candle on daily frame and managed to close above 24400 marks.

* However it has started to form lower highs from the last three sessions and even though support based buying is intact, the index is lacking follow up at higher zones for it to sustain. Now it has to hold above 24400 zones for strength to regain towards 24650 then 24750 zones while supports can be seen at 24200 then 24050 zones.

Derivative Outlook:

* Nifty future closed positive with gains of 0.17% at 24472 levels. Positive setup seen in Paytm, PEL, BSE, IIFL, Bharat Forge, Aarti Industries, Motherson, Tata Motors, SRF, AB Capital, Maruti, APL Apollo and KPIT Tech while weakness in Asian Paints, Sun Pharma, Bajaj Auto, Hudco, ITC, HCL Tech, HAL, Eicher Motors, Grasim, Astral and Petronet LNG.

* On option front, Maximum Call OI is at 24400 then 25000 strike while Maximum Put OI is at 24300 then 24400 strike. Call writing is seen at 24400 then 24850 strike while Put writing is seen at 24300 then 24350 strike. Option data suggests a broader trading range in between 23800 to 24800 zones while an immediate range between 24100 to 24600 levels.

Global Market Update

* European Market - European equities retreated further on Wednesday in subdued trading ahead of a rate decision by the Federal Reserve, and as traders kept an eye on the US and China’s trade talks set for later in the week. UK, Germany and France Index decline up to 0.5%

* Asian Market - Asian equities rose Wednesday after China and the United States said they would hold trade talks at the weekend, fanning optimism that the superpowers can row back eye-watering tariffs that have heightened recession fears.

* US Data - FOMC Interest Rat4e decision.

* Commodity - Oil pushed higher after rallying more than 3% in the previous session as the US and China agreed to start trade negotiations, raising optimism that tensions between the world’s two biggest economies may ease. Brent rose 1% near $63 a barrel.

For More Research Reports : Click Here 

For More Motilal Oswal Securities Ltd Disclaimer
http://www.motilaloswal.com/MOSLdisclaimer/disclaimer.html
SEBI Registration number is INH000000412