Morning Outlook 16th May, 2022

NIFTY:

Nifty opened at15977 with a big gap up of 169 points. The index first tried to fill the gap and moved down. However, prices found support and then rallied higher. The index recorded its intraday high at 16083.60 in the afternoon and then found strong resistance there. Prices have then started drifting downwards and erasing all the gains. The gap was tiIled and the index moved further down to record its intraday low at 15740.85. Prices have finally closed at 15782.15 with a loss of25.85 points or 0.16% down. METAL led the bears today and closed w it h a loss of more than 2% followed by the BANK and FINANCIAL. AUTO led the bulls today and closed with a loss of more than 2% followed by the FMCG and PHARMA.

Prices have seen a down move of more than 2200 points which is more than 12% from its swing highs around 18100 recorded at the beginning of April month. A bearish pattern of lower highs and lower lows is clearly visible. But prices have moved very randomly. First, the gaps were very random one day up and another day down. Second, the Intraday movement was also very volatile. Sharp and sudden moves keep on coming in both directions.

BANK NIFTY:

Bank Nifty opened at 33925.95 wit h a big gap up of 366 points. The index first moved down, found support, and then rallied to record its intraday high at 34002.20.Prices faces strong resistance there and started drifting downwards. A sharp decline brought the index to its intraday low at 33007.90 and prices finally closed at 33086.35 with a loss of 473 points. PVT BANKS have underperformed today and closed lower by 0.75%. PSU BANKS have outperformed today and ended wit h a gain of just 0.04%.Within the index, in terms of points, AU BANK contributed the highest on the upside while ICICI BANK contributed the lowest.

On the weekly timeframe chart, the index is closing lower for the last five consecutive weeks. The index came close to its previous swing low at 32155.35. If this low hold, then we may see a process of consolidation.

TECHNICAL PICKS

DERIVATIVE PICKS

Top Delivery Percentage

UPCOMING ECONOMIC DATA

NEWS UPDATES

• Maruti Suzuki India (MSI) has lined up Rs 5,000 crore capex for various initiatives, including new product launches, for the current financial year, according to a senior company official. The country’s top carmaker, which had earmarked around Rs 4,500 crore in FY22, also believes that parent Suzuki Motor Corp’s investment in Gujarat would help in expanding its battery electric vehicles (BEV) range in the country.
• Prices of home appliances and consumer electronics, including TV, washing machines, and refrigerators, are expected to go up by 3 to 5 per cent from May end or the first week of June as manufacturers pass on the impact of rising input costs to buyers, according to industry players. Moreover, the depreciating Indian rupee against the US dollar has put further woes on manufacturers as imported components have become costlier, with the industry largely being dependent on imports for key components.
• Tata Motors % has increased its capital expenditure by 30% or Rs 9000 crore or 900 million pounds in FY-23 hoping to extend a strong recovery path after the pandemic and buoyed by hopes of the supply chain scenario improving. Tata Motors will be making its highest ever domestic investment of Rs 6000 crore in the current financial year to fund expansion of portfolio of capacity across all its businesses – commercial vehicle, passenger vehicles and electric vehicles under both businesses
• Vodafone Idea (Vi) has added active mobile users in March 2022 — the first time since erstwhile Vodafone India and Idea Cellular merged nearly four years ago. Vi saw active subscriber net adds of 0.2 million in March, the first positive net-add month, post-merger.

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

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