Global cues:
• US markets ended negative on Friday. However, they closed significantly off their lows. This means we can expect the domestic market to attempt and gain some stability and try a mild technical pullback.
• Overnight on Wall Street, Dow Jones fell 2.78 per cent, S&P 500 index dropped 3.51 per cent and Nasdaq index plunged 5 per cent.
• Apple shares fell 8% for their biggest one-day decline since 16 March 2020. Amazon and Netflix were both down more than 4% and Facebook slid 3.8%. Microsoft slipped 6.2%. Alphabet pulled back by 5.1%.
• European shares were trading higher while Asian stocks declined on Friday.
Indian markets:
• On September 4, the Sensex declined 633.76 points to 38,357.18, while the Nifty corrected 193.60 points, to close at 11,333.90.
• Amid multiple events as India- China Clash, Muted economic data, Weak global cues, AGR hearing, Loan structuring, led to more than 2.5% drop in benchmark indices on the weekly time frame.
• FIIs were net sellers of worth Rs. 1,888.78 crore and DIIs were net seller of worth Rs 456.88 crore for September 4, 2020.
• Uncertainty over loan recovery after the latest Supreme Court directions also dented sentiment. As a result, banking and financial stocks were caught in a bear trap.
• Losses in Reliance Industries, HDFC, ICICI Bank, Infosys and Axis Bank wiped out over 300 points from the Sensex.
• Introduction of new margin requirement in the cash segment from 1 September 2020 also put pressure on the bourses. As per the new rule, it is mandatory for brokers to collect margins from investors upfront for any purchase or sale of shares. Failing to do so will attract a penalty.
• In this week, Banking stocks will remain in focus as the next supreme Court hearing on petition seeking interest rate waiver for moratorium period is scheduled on September 10
• IT Services Happiest Minds is set to open its Rs. 702 Crore initial public offering on September 7 and will close on September 9, with a price band of Rs.165-166 per share.
• Omnichannel Could communication service provider will open its three-day Initial public offer on September 9, with a price band of Rs. 345-350 per share.
• Apple fell 16% over last couple of days.
• The nifty contribution chart for today was as follows:
Trends:
• In the week gone by, bulls took a breather, with the Nifty losing 2.7 percent after rising 4.2 percent in the previous two weeks.
• Nifty formed a small bearish candle, which resembles a Doji kind of pattern on the daily charts, and witnessed a Bearish Engulfing formation on the weekly charts which is a negative indication.
• Among sectoral indices, the Nifty Bank opened 400 points or 1.7% lower, followed by auto, IT, realty and the PSU bank index opened with losses of over 1.5%.
• Once the immediate support of 11,100 is broken on the downside, the Nifty might test the lower end of the channel, which is placed at 10,700 levels.
• Nifty implied volatility index (VIX) gains 8% last week and closed in the green candle. We may see higher volatility ahead. PCR shifted its support to 11200.
• Going ahead, ground-level reality of the economy will drive the stock market momentum, which seems to be in a dull phase currently.
• The Bank Nifty under-performed Nifty again, declining 519.30 points, or 2.21 percent, to 23,011.50 on September 4.
• Price formed a large bearish candle and lost 6.17 percent on a weekly chart. Index price has formed a “Dark Cloud” bearish candlestick pattern.
Option strategy for tomorrow:
• The short-term trend of Nifty is Negative with sell on Rally Strategy
• Nifty’s expected range for week is 11000 and 11500. Can sell 11000 weekly PE and sell 11500 weekly CE.
• Nifty is a sell below 11280. Markets may turn bearish very quickly below it.
• Maximum call OI of 20.71 lakh contracts was seen at 11,500 strike which will act as crucial resistance for the week
• Maximum put OI of 27.94 lakh contracts was seen at 11,000 strike which will act as crucial support for the week.
• Given the current technical setup and the ongoing weakness traders should lighten their long positions in the market and maintain a negative outlook with a sell on rally strategy.
• A
broad rangebound consolidation is expected over the coming days.
Stock picks for the day:
HDFC - Stock closed at 1,769.70 on Friday forming a big bearish candle. The stock is currently oversold on Stochastics and MACD also shows a bullish signal. Expect the stock to move up to 1,792 levels
Sun Pharma - Stock closed at 512.45 on Friday forming a bearish signal and it currently is just below its 30 day MA. Expect the stock to slide to 505 levels on an intraday basis
Bata India - Stock closed at 1,349.35 on Friday forming a indecisive bullish candle and the stock is currently in the overbought zone on Stochastics. Expect the stock to face further selling pressure and slide to 1,336 levels
Results on September 7
CG Power and Industrial Solutions, Future Lifestyle Fashions, Future Market Networks, General Insurance Corporation of India, Aurionpro Solutions, Hindustan Oil Exploration and Info Edge India
Source: moneycontrol
Disclaimer
Please note that all the recommendations/views/ levels we provide are based on the theory of technical/fundamental analysis and personal observations. This does not claim for sure/ certain profit or any fix returns. we are not be liable for any losses you make on the given takes and levels. You are advised to take your position with your sense, discretion and judgment. only you would be responsible for outcomes of your trades
Analysts at work:
No comments:
Post a Comment