 "Sensex, Nifty outlook July 18: GIFT Nifty up marginally; Nikkei falls 2%")
Stock market preview, Thursday, July 18, 2024: Equity benchmark indices in India are likely to start Thursday’s trading session on a positive note following the trading holiday on Wednesday. Earnings boost and Budget-related expectations likely to keep the mood upbeat; while the weekly Nifty expiry may trigger some volatility.
Meanwhile, cues from global peers have been mixed over the last two trading sessions amid fears of a US-China trade war.
At 07:00 AM, GIFT Nifty futures quoted around 24,662 as against the spot Nifty close of 24,613 on Tuesday.
Earnings Watch
Infosys, Havells India, LTTS, Mastek, Persistent Systems, Polycab India, Shoppers Stop, Tata Communications and Tata Technologies are among the prominent companies scheduled to announce Q1 results today.
The Budget Show with BS: Stocks, mutual fund, insurance & taxes
More From This Section
Will Budget 2024 trigger a market bull run? Will it help you save on taxes? What will it do for mutual fund investors? Watch the Business Standard Budget show to get the answers. Video here
Global mood
On Wednesday night, the US market ended on a mixed note with the S&P 500 and NASDAQ taking a sharp hit dragged by a sell-off in technology stocks amid fears of a trade-war with China. The S&P 500 shed 1.4 per cent, while NASDAQ tumbled 2.8 per cent. Dow Jones, however, gained 0.6 per cent (243 points). This broader index had surged over 700 points the day before.
The US 10-year bond yield eased to 4.167 per cent. Among commodities, Gold futures quoted around $2,463 levels. Brent Crude Oil futures continued to languish near the $85 per barrel mark.
Equity markets in Asia were steeply in red this morning. Japan’s Nikkei plunged over 2 per cent. Kospi and Taiwan were down 1 per cent.
FII, DII trading activity
Foreign institutional investors (FIIs) were net buyers of stocks worth Rs 1,271.45 crore in the cash market on July 16. Domestic institutional investors (DIIs), on the other hand, net sold shares to the tune of Rs 529.48 crore on Tuesday.
In the derivatives segment, FIIs were net sold 485 contracts of index futures, for a consideration of Rs 58.44 crore on Tuesday. FIIs net bought 475 contracts of Nifty futures, while sold 1,745 contracts of Bank Nifty futures.
Pursuant to which, FIIs index futures long-short ratio remained above 4:1. This ratio means that FIIs hold more than 4 long positions in index futures for every bet on the short side. The FIIs longs in index futures rose to 80.85 per cent, while shorts stood at 19.15 per cent.
On the other hand, DIIs and retail investors’ index long-short ratio continued to remain around 0.5:1; meaning 2 index short bets for every long trade.
Trading strategy for Thursday, July 18 - Should you be a buyer or seller in the Nifty, Bank Nifty today? Here’s what market experts recommend:
Ashwin Ramani, Derivatives & Technical Analyst, SAMCO Securities
The Nifty hit a new all-time high of 24,661 on Tuesday, July 16. The 24,600 Strike saw heavy put writing but the 24,650 & 24,700 strikes saw call writing. The Nifty has made consecutive doji candles on the daily chart signaling indecision. Both the call & put writers battled out at the 24,600 Strike in the Nifty and the option activity at this strike will provide cues about Nifty’s direction ahead of the weekly expiry on Thursday.
On the Bank Nifty, strong call writing was observed at the 52,500 Strike which acted as a strong resistance level for the Index. The Bank Nifty has been moving in a narrow range since last three days. The call writers kept the put writers at bay at the 52,500 Strike and the option activity at this strike will provide cues about Bank Nifty’s upcoming direction.
Osho Krishan, Senior Analyst - Technical & Derivatives, Angel One
There have been no significant developments in the benchmark index, indicating a lack of substantial price movement.
The support zone for the Nifty is at 24,500 -24,400, which is expected to see buyers stepping in when there are dips. However, it's not entirely clear if the trend will continue at higher levels. The Nifty has surpassed the Golden retracement level of 24,610, and the next key level to watch for is around 24,700-24,750.
Hrishikesh Yedve, AVP Technical and Derivatives Research at Asit C. Mehta Investment Interrmediates
Technically, the Nifty has formed multiple ‘Doji’ candles near the resistance zone, indicating short-term uncertainty prevailing in the market. Thus, the high of Tuesday’s ‘Doji’ candle, which is around 24,661, will act as a short-term hurdle for the index. If the index manages to close above it, the rally can extend towards the 24,800 - 25,000 levels.
The Bank Nifty is consolidating in a narrow band but holding above the 21-Day Exponential Moving Average (DEMA) support, which is positioned near 51,960, while the recent swing low is situated near 51,750. As long as the index holds above 51,750, a buy-on-dips strategy should be adopted for Bank Nifty. On the upside, 52,800 and 53,000 will serve as strong resistance levels.
Stocks in F&O ban period
A total of 8 stocks are in futures & options (F&O) ban period on Thursday – Balrampur Chini, Chambal Fertiliser, GMR Infra, GNFC, Hindustan Copper, Piramal Enterprises, RBL Bank and Vedanta.
Primary market update
Tunwal E-Motors IPO to close today. The issue so far has been subscribed 3 times.
Kataria Industries and Macobs Technologies IPOs have seen up to 3.6 times and 2.7 times subscription at the end of Day 1 of the offer period on Tuesday.