It looks like Nifty has resumed the short-term downtrend and can extend the fall toward next supports at 11,200, suggest experts.
It was nothing short of carnage on D-Street. The S&P BSE Sensex breached its crucial support level of 38000 on the downside while the Nifty50 ended below 11,450 levels. Nifty plunged 1.3 percent, its highest single-day fall in nearly six months.
It looks like Nifty has resumed the short-term downtrend and can extend the fall toward next supports at 11,200, suggest experts.
It would be advisable to remain cautious on markets this week. Resistance for Nifty is seen at 11,620.
The rupee which plunged to a record low of Rs 72.67/$ managed to recoup some losses and closed at a fresh record low of 72.45/$.
Depreciating rupee against the dollar has been one of the prime reason behind the fall of Indian market along with concerns over trade war.
NBFC stocks along with select banking names remained under pressure as depreciating currency may force regulators to hike interest rates in the near-term.
Big News:
Rupee closes at a record low, bond yield spikes 13 bps as CAD widens
India’s current account deficit widened to the most in five years
The 10-year gilt yield settled at 8.158 percent - a level is last seen on November 25, 2014
Bond yields and prices move in opposite directions
The current account deficit widened to $15.8 billion in the April-June quarter from a year ago due to a larger trade gap.
The CAD widened to 2.4 percent of gross domestic product (GDP) in April-June, from 1.9 percent of GDP in the January-March quarter, data released Friday showed.
Intensifying EM crisis, fear of a contagion and broad-based USD strength coupled with deteriorating domestic macro scenario and domestic political uncertainty are expected to keep the rupee under pressure, said a Kotak Economic Research said in a note.
It expects USD-INR to range 69-74 for rest of FY2019
Technical View:
Nifty formed a Bearish Belt Hold kind of pattern
Three levels: 11,393, 11,500, 11,620
Max Call OI: 11,800, 11,600
Max Put OI: 11,500, 11,400
Technical Recommendations:
We spoke to HDFC Securities and here’s what they have to recommend:
Mahindra CIE Automotive: Buy| LTP: Rs 297.80| Target Rs 325 | Stop loss: Rs 285 | Return: 9%
ABB India: Buy| LTP: Rs 1,373| Target: Rs 1,480 | Stop loss: Rs 1,300 | Return: 8%
Manappuram Finance: Sell| LTP: 91| Target: Rs 84 | Stop loss: Rs 95 | Return: 8%
Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their 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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