Nifty Overview & Outlook

The Nifty benchmark index concluded Tuesday’s session with a second consecutive day of consolidation. After reaching all-time highs, the Nifty paused at its peak and closed with a slight loss of 0.2%. Similarly, the Nifty Bank followed suit, ending with a minor decrease of 0.3%.

On the broader market front, both the Midcap and Smallcap sectors underperformed the benchmark index, experiencing losses of approximately 0.8% and 0.85%, respectively.

Regarding specific sectors, the Nifty Realty sector erased the gains of the past four days, while the PSU Bank index nullified the gains of the previous day, resulting in losses of 2.2% and 1.3%, respectively. Additionally, Nifty Energy contributed to the overall pessimism by shedding 1.2%. On a brighter note, Nifty Pharma and Nifty Media attempted to support the markets with marginal gains of 0.6% and 0.4%, respectively.

We had talked of a reversal Doji pattern after the Nifty hit the upper trendline of the upward sloping channel. The continuation of this reversal was confirmed with another day of decline, as the Nifty closed below both the previous close and low. This suggests a continuation of the correction in the upcoming sessions. The level of 22,805, representing the 23.6% retracement of the prior upward rally and the breakout level of the Triple Top pattern, will serve as a crucial support level, followed by 22,615 as the subsequent support. Considering the current downside movement as a throwback from the Triple Top breakout, buying activity may be observed around the 22,805 level. We maintain the range of 23,100 to 23,150 as our current resistance zone.

Derivatives Overview & Outlook

Yesterday, short buildup was seen in Banknifty and Midcap nifty futures with increase in open interest by 4.5% and 3.7% respectively, whereas some short covering was observed in Finnifty futures with decrease in open interest by 50%. On the other hand, no significant change was seen in Nifty futures open interest.

Nifty and Banknifty futures have rolled 49% & 51% of open interest into next contracts so far.

On options front, call writing was seen at multiple strikes and maximum positions are at 22500 PE followed by 23000 and 23500 CE closely followed by 23000 CE.

Institutional Trading Activity

Yesterday, FIIs bought stocks worth Rs 66 Cr in the cash segment, bought stocks futures worth Rs 4681 Cr and also bought index futures worth Rs 1962 Cr.  DIIs were net buyer in the cash segment to the tune of Rs 3232 Cr.

Nifty Futures, Banknifty Futures and Finnifty Key Levels

Nifty – Resistances 23000-23050; Supports 22850-22800

Banknifty – Resistances 49400-49600; Supports 49000-48800

Finnifty – Resistances 22050-22100; Supports 21900-21820

F&O Securities in Ban Today – ABFRL, BIOCON, HINDCOPPER, IDEA, PEL.

Important Results Today– ALKEM, CUMMINSIND, DBREALTY, DEEPAKFERT, IPCALAB, KNRCON, LEMONTREE, MAZDOCK, MOTHERSON, SJVN, TATASTEEL.

Globe Capital Market Limited (“GCML”) is a Stock Broker registered with BSE, NSE, MCX, NCDEX, ICEX and MSEI in all the major segments viz. Capital, F & O and CDS segments. GCML is also a Depository Participant and registered with both the Depositories viz. CDSL and NSDL. Further, GCML is a SEBI registered Portfolio Manager and Research Analyst. GCML includes subsidiaries, group and associate companies, promoters, directors, employees and affiliates.

Globe Commodities Limited, Globe Derivatives and Securities Limited & Globe Fincap Limited are subsidiaries of GCML. Rolex Finvest Private Limited, A to Z Consultants Private Limited, A to Z Venture Capital Limited, M. Agarwal Stock Brokers Private Limited, A M Share Brokers Private Limited, Shri Adinath Advertising Company Pvt. Ltd., Orient Landbase Private Limited, Bolt Synthetic Private Limited, Price ponder Private Limited and Lakshya Impex Private Limited  are associates of GCML.

This report has been prepared by GCML and published in accordance with the provisions of Regulation 19 of the Securities and Exchange Board of India (Research Analysts) Regulations, 2014, for use by the recipient as information only and is not for general circulation or public distribution. This report is not to be altered, transmitted, reproduced, copied, redistributed, uploaded, published or made available to others, in any form, in whole or in part, for any purpose without prior written permission from GCML. The projections and the forecasts described in this report are based on estimates and assumptions and are inherently subject to significant uncertainties and contingencies. Projections and forecasts are necessarily speculative in nature, and it can be expected that one or more of the estimates on which the projections are forecasts were based may not materialize or may vary significantly from actual results and such variations will likely increase over the period of time. This report should not be construed as an offer to sell or the solicitation of an offer to buy, purchase or subscribe to any securities, and neither this report nor anything contained therein shall form the basis of or be relied upon in connection with any contract or commitment whatsoever. It does not constitute a personal recommendation or take into account the particular investment objective, financial situation or needs of any individual in particular. The research analysts of GCML have adhered to the code of conduct under Regulation 24 (2) of the Securities and Exchange Board of India (Research Analysts) Regulations, 2014. The recipients of this report must make their own investment decisions, based on their own investment objectives, financial situation or needs and other factors. The recipients should consider and independently evaluate whether it is suitable for its/ his/ her/their particular circumstances and if necessary, seek professional / financial advice as there is substantial risk of loss. GCML does not take any responsibility thereof.

Any such recipient shall be responsible for conducting his/her/its/their own investigation and analysis of the information contained or referred to in this report and of evaluating the merits and risks involved in securities forming the subject matter of this report. The price and value of the investment referred to in this report and income from them may go up as well as down, and investors may realize profit/loss on their investments. Past performance is not a guide for future performance. Actual results may differ materially from those set forth in the projection.

This report has been prepared by GCML based on the information available in the public domain and other public sources believed to be reliable. Though utmost care has been taken to ensure its accuracy and completeness, no representation or warranty, express or implied is made by GCML that such information is accurate or complete and/or is independently verified. The contents of this report represent the assumptions and projections of GCML and GCML does not guarantee the accuracy or reliability of any projection, assurances or advice made herein. Nothing in this report constitutes investment, legal, accounting and/or tax advice or a representation that any investment or strategy is suitable or appropriate to recipients’ specific circumstances.

Since GCML or its associates are engaged in various financial activities, they might have financial interest or beneficial ownership in various companies including subject company/companies mentioned in the report. GCML or its associates have not received any compensation for investment banking or merchant banking from the subject company in the past 12 months.  GCML or its associates might have received any compensation including brokerage services and for products or services other than investment banking or merchant banking from the subject company in the past 12 months. It is confirmed that GCML or research analyst or its associates have not managed or co-managed public offering of securities for the subject company in the past 12 months.

Research analyst or GCML or its relatives’/associates’ have no material conflict of interest at the time of publication of this report. Neither research analyst nor GCML are engaged in market making activity for the subject company. It is confirmed that research analysts do not serve as an officer, director or employee of the subject company. It is also confirmed that research analyst have not received any compensation from the subject company in the past 12 months. GCML or its associates have not received any compensation or other benefits from the Subject Company or third party in connection with the research report.

No material disciplinary action has been taken on GCML by any regulatory authority impacting Equity Research Analysis activities.

The views contained in this document are those of the analyst, and the company may or may not subscribe to all the views expressed within. This information is subject to change, as per applicable law, without any prior notice. GCML reserves the right to make modifications and alternations to this statement, as may be required, from time to time.

Research analyst or GCML or its relatives’/associates’ do not have actual/beneficial ownership of 1% or more in securities of the subject company, at the end of the month immediately preceding the date of publication of the document.

Registration granted by SEBI, membership of BASL (in case of IAs) and certification from NISM in no way guarantee performance of the intermediary or provide any assurance of returns to investors.