The index needs to close above 11,571 for it to move towards 11,620 levels. Support on the downside is placed at 11500, 11393 levels.
A smart recovery towards the close of the session with Sensex rising by over 200 points while the Nifty50 reclaimed 11500 levels comfortably.
It was a volatile day for Indian markets thanks to fall in rupee which closes just below Rs 72/$.
The index needs to close above 11,571 for it to move towards 11,620 levels.
Support on the downside is placed at 11500, 11393 levels.
Big News:
The rupee touched a fresh all-time low of Rs 72.1/$ boosted sentiment for exporting industries like IT and Pharmaceuticals.
The pharmaceutical index was the pick of the day with a whopping 3 percent gain.
Short-term concerns remain mainly due to rising crude oil prices and bond yields which will only add to the fiscal deficit.
With yields crossing 8 percent, there will be increased fiscal costs on the part of the government every year. We expect such costs to be at least Rs 6000-7000 crore, SBI said in a report.
With crude oil averaging to $76/bbl for the remaining half and average exchange rate at Rs 73/ US dollar, the extra cost could go up to Rs 45,700 crore.
If the rupee continues to depreciate, it may move RBI towards increasing the regulatory interest rates.
Technical Recommendations:
Nifty formed a Hammer-like pattern for the second day
A Hammer which is a bullish reversal pattern is formed after a decline
As long as this index remains above 11,400 levels one should retain positive bias and selectively look for long side opportunities
A breach of 11,393 shall result in resumption of the down move with a target of 11,016 kind of levels on the indices
Three levels to watch: 11393, 11620, 11760
Max Call OI: 11800, 11600, 11200
Max Put OI: 11400, 11500
Stocks in news:
L&T's ex-employee moves NCLT alleging mismanagement by firm
Bajaj Auto to increase capacity of three-wheeler plant by nearly 20 percent
L&T Technology Services to buy Bangalore-based Graphene Semiconductor for Rs 93 crore
Technical Recommendations:
We have spoken to Way2Wealth Brokers Pvt. Ltd and here's what they have to recommend:
Jubilant Foodworks: Sell around Rs 1435 - 1450| LTP: Rs 1417| Target: Rs 1330| Stop loss: Rs 1495| Time frame: 15 to 21 trading session| Return: 6%
Dr Reddy's Laboratories: Buy around Rs 2580 - 2530| LTP: Rs 2567| Target: Rs 2760| Stop loss: Rs 2460| Return: 7%
Tata Motors: Buy around Rs 270| LTP: Rs 269| Target: Rs 305| Stop loss: Rs 254| Return: 14%
Disclaimer: The views and investment tips expressed by investment expert on Moneycontrol.com are his own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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