12 things that will decide stock action on Monday
NEW DELHI: As Nifty ended above the 11,900 level on Friday it formed a bullish candle on the daily chart.
Nagaraj Shetti of HDFC Securities said the underlying trend of Nifty continues to be positive. “The overall chart pattern signals more upside for the market in the near term. The upside targets to be watched for the coming week is at 12,250. Immediate support is placed at 11,800,” he said.
Ajit Mishra of Religare Broking said the recent buoyancy in the banking pack may help the index inch higher but traders should maintain extra caution in the selection of stocks as limited participation is seen from the index majors.
“Besides, with the earnings season gaining pace, we can’t rule out the possibility of erratic swings in the stocks,” he said.
Chandan Taparia of Motilal Oswal Securities said the index needs to hold above 11,800 to witness a further upmove towards the 12,000 level. “A major support for the index exists at 11,750,” he said.
That said, here’s a look at what some of the key indicators are suggesting for Monday’s action:
US stocks inch higher on stimulus optimism
US stocks rose on Friday and the S&P 500 and Nasdaq registered their biggest weekly percentage gains since July as optimism over more federal fiscal aid grew. The Dow Jones Industrial Average rose 161.39 points, or 0.57 per cent, to 28,586.9, while the S&P 500 gained 30.31 points, or 0.88 per cent, to 3,477.14.
European shares record gains for second week
European stocks posted a second consecutive week of gains on Friday as bumper forecasts from Denmark’s Pandora and Novo Nordisk set a brighter tone for the earnings season, while investors kept an eye out for signs of fresh U.S. stimulus. The STOXX 600 index ended up 0.6 per cent to close the week with a gain of 2.1 per cent.
Tech View: Nifty negates Thursday’s Doji
Nifty50 on Friday topped the 11,900 mark, as it ended up gaining for the seventh straight session. Despite having recovered strongly from a low point at 10,800 in the last few sessions, the index is not showing any major sign of fatigue. Nifty formed a bullish candle on the daily chart, negating Thursday’s indecisive Doji candle. It showed the bulls are in no mood to give in yet.
F&O: Entire market base shifts higher
Nifty opened positive on Friday and continued its positive to rangebound move as it headed towards the 11,940 level. The index managed to hold the 11,800 level and closed the last day of the week with net gains of around 80 points. The index continued to form higher lows for the 10th session and entire base of the market shifted higher and looked set to hit the psychologically important 12,000 level and then knock the lifetime high territory.
Stocks showing bullish bias
Momentum indicator Moving Average Convergence Divergence (MACD) on Friday showed bullish trade setup on the counters of LIC Housing, Bharti Airtel, HCL Technologies, NHPC, Havells India, Bank of India, PNB Housing Finance, PTC India, Karnataka Bank, United Breweries, Divi’s Lab, Vikas WSP, Globus Spirits, NCL Industries, Kwality, SMS Pharmaceuticals, Essel Propack, Jindal Poly Films, South West Pinnacle, Nitco, GNA Axles, Orient Bell, Seshasayee Paper, Gokul Agro Resources, Capacit’e Infraprojects, Banaras Beads, Ador Welding, Thermax, Prakash Pipes, Universal Cables, Avadh Sugar & Energy, Gallantt Metal, GE T&D India, AGC Networks, Weizmann and WABCO India among others.
Stocks signalling weakness ahead
The MACD showed bearish signs on the counters of Lupin, Sterlite Technologies, Indiabulls Ventures, KPIT Technologies, Thirumalai Chem, Tejas Networks, FDC, Dynemic Products, Persistent Systems, Quess Corp, Newgen Software Tech, Huhtamaki PPL, Blue Dart Express, Minda Industries, Vardhman Textiles, Mahindra Logistics, Anup Engineering and Harita Seating Systems, among others.
Friday’s most active stocks
HDFC Bank (Rs 2,739.99 crore), TCS (Rs 2,170.17 crore), HDFC (Rs 2,155.74 crore), Wipro (Rs 2,026.80 crore), RIL (Rs 1,908.37 crore), Bajaj Finance (Rs 1,908.17 crore), Vedanta (Rs 1,783.62 crore), ICICI Bank (Rs 1,655.07 crore), Axis Bank (Rs 1,296.59 crore) and SBI (Rs 1,265.98 crore) were among the most active stocks on Dalal Street on Friday in value terms.
Friday’s most active stocks in volume terms
Vedanta (shares traded: 14.81 crore), Vodafone Idea (shares traded: 11.34 crore), SBI (shares traded: 6.49 crore), Wipro (shares traded: 5.54 crore), YES Bank (shares traded: 4.89 crore), ICICI Bank (shares traded: 4.16 crore), PNB (shares traded: 4.11 crore), Tata Motors (shares traded: 3.71 crore), IDFC First Bank (shares traded: 3.31 crore) and LIC Housing Finance (shares traded: 3.29 crore) were among the most traded stocks in the session.
Stocks seeing buying interest
Wipro, JK Cement, Hero MotoCorp, Apollo Hospital and Hathway Cable witnessed strong buying interest from market participants as they scaled their fresh 52-week highs on Friday signalling bullish sentiment.
Stocks seeing selling pressure
Computer Age Management Services, S&S Power Switchgears, Silly Monks Entertainment, United Drilling Tools and Coal India witnessed strong selling pressure in Friday’s session and hit their 52-week lows, signalling bearish sentiment on these counters.
Sentiment meter favours bears
Overall, market breadth remained in favour of bears. As many as 211 stocks on the BSE 500 index settled the day in green, while 286 settled the day in red.
Podcast: Is the market ripe for profit booking?>>>
Domestic stocks have been witnessing a spectacular rally on the back of FPI buying and stimulus hopes. Signs of green shoots in the economy and the central bank’s promise to keep doing what it takes to revive growth is also boosting the sentiment on Dalal Street. But are the bulls beginning to show signs of fatigue after a relentless rally? If yes, how should investors position themselves in this market? We discuss this and more in today’s special podcast with independent market expert Rajiv Nagpal.