Ahead of Market: 12 things that will decide stock action on Friday

NEW DELHI: Nifty50 on Thursday ended above 17,200 for the first time and formed a bullish candle on the daily chart. Analysts said, after taking out the crucial 17,200 level, the index may move towards the 17,300-17,400 range.

Here’s how analysts read the market pulse:

Chandan Taparia of Motilal Oswal Securities sees downside support for Nifty at 17,050 and 16,900 levels. “Nifty50 needs to hold above 17,150 to extend its upmove towards 17,400 level,” he said.

Mazhar Mohammad of Chartviewindia.in said, if the index fails to sustain above 17,250, it may slip into consolidation mode. “The momentum has a positive bias and dips will remain an opportunity for investors to go long on Nifty50 with a stop below the 17,050 level,” he said.

That said, here’s a look at what some of the key indicators are suggesting for Friday’s action:

Wall Street benchmarks hit fresh highs

The S&P 500 hit a record high on Thursday, boosted by gains in heavyweight technology and energy companies, as well as on hopes that the Federal Reserve will maintain an accommodative policy amid signs that economic recovery was slowing. At 10:24 a.m. ET, the Dow Jones Industrial Average was up 116.52 points, or 0.33 per cent, at 35,429.05, the S&P 500 was up 14.66 points, or 0.32 per cent, at 4,538.75, and the Nasdaq Composite was up 30.13 points, or 0.20 per cent, at 15,339.52.

European shares end short of fresh highs

European shares closed higher on Thursday as expectations of improving economic growth supported oil stocks, while drugmaker Swedish Orphan Biovitrum (SOBI) was the top performer on the STOXX 600 after accepting an $8 billion takeover offer. The pan-European STOXX 600 index rose 0.3 per cent, with oil stocks adding 1.8 per cent as crude prices surged on optimism over economic recovery, a sharp decline in U.S. crude stocks and a weaker dollar.

Tech View: Nifty bulls eye more gains

Nifty50 on Thursday took out the 17,200 level in a session dominated by the bulls. The index formed a bullish candle on the daily chart and made a higher high-low formation for the fourth successive day. Analysts see good chances of the index moving towards the 17,300-17,400 range. Key support for the NSE barometer now stands at 17,050, they said.

F&O: Nifty50 range shifts higher

India VIX moved up 0.42 per cent from 14.18 to 14.24 levels. Stability in volatility and declines from higher levels suggest the bulls are holding a tight command on the market. On the options front, maximum Put open interest stood at 16,500 followed by 17,000 levels, while maximum Call OI was seen at 17,500 followed by 17,000 levels.

Stocks showing bullish bias

Momentum indicator Moving Average Convergence Divergence (MACD) showed bullish trade setup on the counters of Trident, Tata Power, ITC, Indiabulls Housing Finance, DLF, Federal Bank, Kotak Mahindra Bank, NTPC,

, , GSFC, Madras Fertilizer, IRCTC, , Jain Irrigation, Jyothy Labs, Bharat Forge, , Coffee Day Enterprise, Cummins India, Century Textiles, Kesoram Industries, Aditya Birla Capital, PTC India Financial, Sanghi Industries, Den Networks, MSTC, Network 18 Media, Jubilant Foodworks, D-Link (India), Rossari Biotech, EID Parry, Shoppers Stop, Finolex Cables, Eris Lifesciences, Max India, Graphite India, Force Motors, GMM Pfaudler, Muthoot Capital, Orient Press, Incredible Industries and Balaxi Pharmaceutica.

The MACD is known for signalling trend reversals in traded securities or indices. When the MACD crosses above the signal line, it gives a bullish signal, indicating that the price of the security may see an upward movement and vice versa.

Stocks signalling weakness ahead

The MACD showed bearish signs on the counters of Mahindra & Mahindra, Ipca Laboratories, Endurance Technologies, Mahindra Logistics, Crest Ventures, Schaeffler India and Dynamatic Technology. A bearish crossover on the MACD on these counters indicated that they have just begun their downward journey.

Most active stocks in value terms

Indian Energy Exchange (Rs 1445.93 crore), TCS (Rs 1292.77 crore), Bharti Airtel (Rs 1244.69 crore), HDFC Life (Rs 1228.80 crore), Infosys (Rs 1144.26 crore), RIL (Rs 1051.68 crore), Vedanta (Rs 1016.98 crore), Kotak Bank (Rs 1016.66 crore), Delta Corp (Rs 941.55 crore) and Bajaj Finance (Rs 888.49 crore) were among the most active stocks on Dalal Street in value terms. Higher activity on a counter in value terms can help identify the counters with highest trading turnovers in the day.

Most active stocks in volume terms

Vodafone Idea (Shares traded: 73.62 crore), YES Bank (Shares traded: 15.96 crore), Suzlon Energy (Shares traded: 6.76 crore), Delta Corp (Shares traded: 4.52 crore), PNB (Shares traded: 3.59 crore), BHEL (Shares traded: 3.50 crore), Trident (Shares traded: 3.49 crore), Vedanta (Shares traded: 3.33 crore), Zomato (Shares traded: 2.79 crore) and NALCO (Shares traded: 2.77 crore) were among the most traded stocks in the session.

Stocks showing buying interest

HDFC Life, Sobha, Macrotech Developers, HLE Glasscoat and Polycab India witnessed strong buying interest from market participants as they scaled their fresh 52-week highs, signalling bullish sentiment.

Stocks seeing selling pressure

Nandani Creation and Yuken India witnessed strong selling pressure and hit their 52-week lows, signalling bearish sentiment on these counters.

Sentiment meter favours bulls

Overall, the market breadth remained in favour of the bulls. As many as 335 stocks on the BSE500 index settled the day in the green, while 159 settled the day in the red.

Podcast: what’s driving the market rally?
BSE Sensex soared about 515 points to settle above 57,850, just 40-odd points below day’s high. Nifty 50 gained about 160 points to close at 17,234, about 20 points below its all-time high. Broader markets outperformed as they marched along with the benchmark indices as BSE midcap and smallcap indices added up to a per cent each. what’s driving the market rally? What does broader markets’ constant outperformance suggest?

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