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


NEW DELHI: Nifty50 on Wednesday formed a bullish candle on the daily scale with no lower wick, signalling sharp gains ahead. Analysts said the index can take out the crucial 17,800 level in the coming days.

Here’s how analysts read the market pulse:

Mazhar Mohammad, Chief Strategist of Chartviewindia.in said Nifty may cross the 17,800 level if it manages to sustain the 17,386 level. “A close below the 17,386 level may trigger weakness, with an initial target of 17,250,” he said.

Shrikant Chouhan of Kotak Securities said the index closing above the 17,500 level indicates a strong possibility of a continuation of the uptrend momentum up to 17,575. “Trading below 17,450 may trigger a quick intraday correction up to 17,400-17,350 levels,” he said.

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

Wall St recovers from previous losses

The S&P 500 and the Dow Jones indexes rose on Wednesday, with sectors such as energy and financials recovering some of their losses in recent sessions, although a slowing economic recovery and uncertainty over higher taxes kept sentiment subdued. At 09:59 am ET, the Dow Jones Industrial Average rose 110.21 points, or 0.32 per cent, to 34,687.78, the S&P 500 gained 10.83 points, or 0.24 per cent, to 4,453.88 and the Nasdaq Composite lost 12.01 points, or 0.08 per cent, to 15,025.75.

European shares fall

European shares slipped on Wednesday as utilities fell on Spain’s move to cap energy bills, while luxury stocks continued to weaken on worries about a slowing Chinese economy. The benchmark STOXX 600 index was down 0.8 per cent, and off about 2.5 per cent from the record high in mid-August.

Tech View: Nifty50 breaks out of narrow range

Nifty50 on Wednesday took out the 17,500 level on a closing basis and broke out of the narrow trading range where it had been moving in the last six sessions. The index formed a bullish candle on the daily scale with no lower wick, suggesting sharp gains from the word go. Analysts said the index has the potential to move towards the 17,800 level in the coming days.

F&O: VIX needs to hold below 13 level

India VIX moved up 1.10 per cent from 13.58 to 13.73 level. The fear gauge needs to hold below the 13-level to continue the bullish momentum. Options data suggested a broader trading range between 17,200 and 17,800 levels, while the immediate trading range was seen between 17,350 and 17,700 levels.

Stocks showing bullish bias

Momentum indicator Moving Average Convergence Divergence (MACD) showed bullish trade setup on the counters of Canara Bank, Jamna Auto Industries, Varroc Engineering, Thirumalai Chem, Eveready Industries, Gravita India, NIIT, Rossari Biotech, Hikal, MphasiS, Bata India, JK Paper, R Systems International, Trejhara Solutions, ICICI Securities, Tata Elxsi, Coforge, Sumitomo Chemical, Sundaram Finance, Relaxo Footwears, Centum Electronics, Heritage Foods, Ramkrishna Forgings, Power Mech Projects, Agro Phos India, Om Infra, Westlife Development, Seya Industries, Kalyani Steel, Subros, Talbros Auto, Ruchi Soya, Sintercom India, Rajratan Global Wire, Salona Cotspin, Niraj Cement and Nalwa Sons Investment.

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 HDFC, Hindustan Unilever, Elecon Engineering, UltraTech Cement, Britannia Industries, Cerebra Integrated, Nitin Spinners, TD Power Systems, Safari Industries, Apollo Pipes and VST Tillers. A bearish crossover on the MACD on these counters indicated that they have just begun their downward journey.

Most active stocks in value terms

Zee Entertainment (Rs 5428.01 crore), Bharti Airtel (Rs 4020.25 crore), IRCTC (Rs 3214.24 crore), Adani Enterprises (Rs 1938.84 crore), HDFC Bank (Rs 1144.15 crore), RIL (Rs 996.50 crore), SBI (Rs 974.75 crore), TCS (Rs 967.17 crore), Tata Power (Rs 963.05 crore) and Kotak Bank (Rs 906.55 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: 96.74 crore), YES Bank (Shares traded: 33.81 crore), Zee Entertainment (Shares traded: 20.03 crore), Dish TV India (Shares traded: 11.53 crore), Tata Power (Shares traded: 6.89 crore), PNB (Shares traded: 5.76 crore), Bharti Airtel (Shares traded: 5.58 crore), NTPC (Shares traded: 4.87 crore), GTL Infra (Shares traded: 4.85 crore) and ONGC (Shares traded: 4.24 crore) were among the most traded stocks in the session.

Stocks showing buying interest

Zensar Tech, Rossari Biotech, NTPC, Nazara Technologies and Clean Science & Technology witnessed strong buying interest from market participants as they scaled their fresh 52-week highs, signalling bullish sentiment.

Stocks seeing selling pressure

ABM International and Vertoz Advertising 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 324 stocks on the BSE500 index settled the day in the green, while 173 settled the day in the red.

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