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


Nifty50 formed a bullish candle on the daily chart during Thursday’s Muhurat trading session as the benchmark index snapped a two-day selling streak.

The Indian stock market was closed on Friday on account of Diwali Balipratipada.

Here’s how analysts read the market pulse:-

Rohit Singre, Senior Technical Analyst at LKP Securities said the index has formed a small consolidation zone of 17,600-18,000. “Unless we don’t see a breakout on either side, we may not see a clear directional move. Profit booking can be witnessed towards the immediate support zone of 17,750-17,700 zone,” he said.

Ajit Mishra, vice-president of research at Religare Broking said that indications are the index could consolidate further and that participants may need to be cautious and mindful of overnight risk management.

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

US shares

Wall Street closed the week at record highs aided by a stronger-than-expected jobs report for October, which further reasserted the ongoing economic momentum in the US. Further, reports that Pfizer has successfully developed a Covid pill that reduces risk of hospitalization by 89 per cent when symptoms occur.

European shares
European equities ended largely flat after a string of record highs achieved earlier in the week. Fading concerns over tightening of monetary policy globally was somewhat offset by losses in shares of energy and basic material producers.

Tech View: 18,000 remains key hurdle

Analysts said that the Nifty50 index is likely to stay in consolidated mode in the coming sessions as it lacks momentum to cross a strong resistance at 18,000 points mark. Strength in the Nifty50 will be expected only if it closes above 18,000 points and in such a case 18,200-250 levels are likely, said Mazhar Mohammad of Chartviewindia.in.

F&O: Hope remains high

In the derivatives segment, traders bought out-of-money call options of the Nifty50 index in Thursday’s special session reflecting optimism. The 18,300 strike price call option of the index saw the highest addition of open interest indicating that traders expect a rebound till that level in the coming week.

Stocks showing bullish bias

Momentum indicator Moving Average Convergence Divergence (MACD) showed bullish trade setup on the counters of Mirza International, Orient Paper, HFCL, Lemon Tree, and Finolex Chemicals.

The MACD is known for signaling 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 Tata Motors, ICICI Bank, United Drilling Tools, IFB Agro, Sanofi India, and Greenlam Industries. Bearish crossover on the MACD on these counters indicated that they have just begun their downward journey.

Most active stocks in value terms

SBI (Rs 521.4 crore), Eicher Motors (Rs 366.4 crore), Tata Power (Rs 344 crore), Tata Motors (Rs 271.3 crore), ICICI Bank (Rs 247.0 crore), RIL (Rs 196.6 crore), Indiabulls Real Estate (Rs 188.0 crore), IRCTC (Rs 183 crore), Indian Hotels (Rs 179.8 crore) and Magma Fincorp (Rs 165.1 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: 3.3 crore), YES Bank (Shares traded: 2.6 crore), Tata Power (Shares traded: 1.5 crore), PNB (Shares traded: 1.3 crore), Bank of Baroda (Shares traded: 1.1 crore), Indiabulls Real Estate (Shares traded: 1.0 crore), IRFC (Shares traded: 0.99 crore), SBI (Shares traded: 0.97 crore), and Magma Fincorp (Shares traded: 0.94 crore) were among the most traded stocks in the session.

Stocks showing buying interest
SKF, Century Ply, Barbeque-Nation, Tata Tele, 3i Infotech and Happiest Minds witnessed strong buying interest from market participants as they scaled their fresh 52-week highs, signaling bullish sentiment.

Stocks seeing selling pressure

Kotyark Industries, Silly Monks, Priti International, and Kirti Industries witnessed strong selling pressure and hit their 52-week lows, signaling bearish sentiment on these counters.

Sentiment meter favours bulls

Overall, the market breadth remained in favour of the bulls. As many as 444 stocks on the BSE500 index settled the day in the green, while 56 settled the day in the red.

Podcast: Can India Inc’s Q2 earnings trigger further re-rating in the market?



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