Morning Outlook 10th November, 2022

NIFTY:

The NIFTY opened at 18288.25 with a gap up of 86 points. The index recorded its intraday high at around 18296.40 in its initial trades and then started drifting downwards. A sharp deadline filled the gap and then prices went into a process of consolidation which eventually broke on the downside. The index fell further to record its intraday low at 18117.50. The NIFTY finally closed at 18157 with a loss of 45.80 points or 0.25% down. BANK and FMCG outperformed today and closed within or gains. PHARMA and REALTY underperformed today and closed with a loss of over 1% followed by METAL which ended nearly 1% lower.  The short-term trend is up and there is no doubt about it as prices are trading near the swing highs on the current up move. However, we have seen an upside surge from 17000 to 18200 without much of a correction. After such a large move, prices tend to consolidate or even see a dip. That is natural as prices move in a staircase pattern. It is possible that the index has already begun a process of consolidation. Support is visible around the 17950 – 18000 zone while resistance is visible around the 18200 – 18300 zone. As of now, we should avoid trading the index and wait for an adequate set-up to emerge.

BANK NIFTY:

The BANK NIFTY opened at 41914.85 with a gap up of 193 points. The index moved down, filled the gap, and then found support around 41700. Prices have consolidated there and then moved up to record its intraday high at 41948.90. The index again moved down with more pace, recorded its intraday low at 41667.90, and finally closed at 41690.65 without much of a change. PSU BANKS have outperformed today by closing 3.93% higher while PVT BANKS have closed on a flat note. Within the index, in terms of points, BANK BARODA contributed the highest on the upside while ICICIBANK contributed the lowest. BANK NIFTY has seen a volatile movement today and ended on a flat note. The index recorded lifetime new highs today but could not sustain there long enough. We have been tracking a narrow trading range inside 40800 – 41700. This range has seen a breakout yesterday but did not see a follow-through today putting a question mark. However, the short-term trend is up and it will be up as long as prices are trading above 40800. We should look for buying opportunities only. Shorting opportunities may emerge on a lower closing below 40800.

TECHNICAL PICKS

DERIVATIVE PICKS

TOP DELIVERY PERCENTAGE

UPCOMING ECONOMIC DATA

NEWS UPDATES

• In the highly volatile session the Indian benchmark indices ended lower with Nifty below 18200.At Close, the Sensex was down 151.60 points or 0.25% at 61,033.55, and the Nifty was down 45.80 points or 0.25% at 18,157. About 1669 shares have advanced, 1745 shares declined, and 108 shares are unchanged.

• The lock-in for Nykaa shares expires on November 10. Private equity funds and high networth individuals (HNIs), who were early investors in cosmetics-to-fashion retailer Nykaa, are the biggest winners as the stock still trades below IPO issue price.

• The transactions in government securities (G-Sec) in the secondary market using the central bank’s digital currency recorded the highest volume on November 7 since its inception on the back of higher trades settled in the 10-year benchmark bond.

• Banks are likely to confront higher retail loans turning bad as accelerating inflation, high interest rates and job losses hurt borrowers’ capacity to repay loans, experts and analysts told Moneycontrol on November 9.

Source: Economic Times,  Indian Express, Business Today, Livemint, Business Standard, Bloomberg Quint

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