 "NSE")
Pre-market stock update for May 07, Tuesday: Equity investors will be hoping for some stability to return to the equity market following the recent bout of volatility as global stocks display a firm trend amid renewed hopes of a US Fed rate cut.
At 07:00 am, Gift Nifty futures quoted near 22,603 levels, hinting at a likely gap-up start to the trading action on the Nifty 50 index.
One of the key reasons for the market volatility has been persistent selling by foreign investors. Foreign investors have net sold stocks worth Rs 89,850 crore so far in 2024. On the other hand, domestic institutional investors have net purchased shares to the tune of Rs 1.53 lakh crore in the same period.
Owing to the FII sell-out, data compiled by PRIME Database shows that foreign portfolio investors shareholding in NSE-listed companies fell 51 basis points sequentially to 17.68 per cent at the end of March 2024 quarter.
This is the lowest FPI shareholding since December 2012. The gap between FPI and DII investors has narrowed to just 163 basis points, a new low. READ MORE
Should you be a buyer or seller today? Here’s what technical experts have to say:
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On Monday, the benchmark indices, the Sensex and the Nifty, kept investors on their toes, with the latter frequently swinging in and out of the positive terrain.
Following the recent rise in volatility, Ashwin Ramani, derivatives & technical analyst at SAMCO Securities highlights that the India VIX hit a 52-week high of 16.96 yesterday. The fear gauge has risen 62 per cent in the last eight trading sessions.
The VIX has taken multiple resistances around the 16.5 levels since the start of 2024 and any rise from these levels can cause discomfort to the bulls, the analyst cautioned.
In the derivatives segment, put writers (Bulls) exited from the 22,700 Strike in Nifty on Monday. Strong call writing (Bears activity) was observed at 22,600 & 22,500 Strike in the Index. However, the 22,400 Strike saw put writing (Bulls’ activity) which kept the Index in a tight range, Ashiwni said.
On the Bank Nifty, call writers (Bears) further strengthened their position at the 49,500 Strike. Strong call writing was observed at the 49,200 & 49,000 Strikes. The call writers (Bears) lead the put writers (Bulls) at the 49,000 Strike and the option activity at this strike will provide cues about Bank Nifty’s near-term direction.
Talking about key levels in particular, Om Mehra, technical analyst at SAMCO Securities, says that if Nifty slips below the crucial 22,400 level, it could potentially lead to a more pronounced decline. Key levels to watch include immediate support at 22,300 while resistance is placed at 22,550 followed by 22,600. Until the index attains 22,600, it would be better to employ a sell-on-rise strategy.
Global cues
The US market extended its rally on Monday amid renewed hopes of an interest rate cut by the US Fed. Doe Jones gained 0.5 per cent. Nasdaq and the S&P 500 soared over 1 per cent each.
The US 10-year bond yield remained subdued at 4.489 per cent.
Among key commodities, Gold futures rose to $2,330 levels, while Brent Crude Oil traded on a steady note around $83.50 levels.
In the Asia-Pacific region this morning, Nikkei and Kospi rallied over 1.5 per cent each. The Australian indices were up 0.5 per cent.
Stocks in focus
On Tuesday, stocks of Century Textiles, Chambal Ferilisers, Delta Corp, Dr.Reddy's, IDFC, Indraprastha Gas, IRB Infrastructure, Jindal Saw, JSW Energy, Jupiter Wagons, Kajaria Ceramics, KEC International, Latent View Analytics, Max Financial Services, Navin Fluorine International, Pidilite Industries, PB Fintech, Sonata Software, SRF and Voltas will be in focus as these companies announce Q4 results.
Primary Market Update
In the SME segment, Finelistings Technologies IPO will open for subscription today at a fixed price of Rs 123 per share. The company plans to raise up to Rs 13.53 crore by way of fresh issue of equity shares.
In other news
the market regulator Sebi has returned the proposal by the NSE for market time extension in the derivatives segment due to a lack of consensus among the broker community.
the market regulator Sebi has returned the proposal by the NSE for market time extension in the derivatives segment due to a lack of consensus among the broker community.
The NSE had filed a plea with the market regulator to keep the derivatives market open for three extra hours between 6 pm and 9 pm to help market participants gauge and act on global news flows in the evening. READ MORE
