Morning Outlook 22th August, 2022

NIFTY:

The NIFTY opened at 17966.55 without much of a gap. The index initially consolidated and then broke on the downside after recording its intraday high at 17992.20. Prices have seen a sharp intraday decline till the afternoon and then went into a process of consolidation. The index moved sideways till the end of today’s trading session. Prices have recorded their intraday low at 17710.75 and finally closed at 17758.45 near their day’s lows with a loss of 198.05 points or 1.10% down. All the sectoral indices have closed lower today except IT which ended with minor gains. The MEDIA sector closed today with a minor loss while all the other sectoral indices have closed lower by more than 1%. On the weekly timeframe chart, the index continued closing higher. However, the index closed almost on the opening tick and registered minor gains when compared to last week’s closing price. The short-term trend is still up. We have mentioned a support level of around 17700 in the NIFTY index while resistance at around the 18000 mark. We have been anticipating a dip and that came today. We should now wait for prices to find support. We will then plan our trade accordingly. Till then we should now avoid trading the index.

BANK NIFTY:

The BANK NIFTY opened at 39732.65 with a gap of just 62 points. The index did not sustain higher and started drifting downwards after recording its intraday high at 39759.15. Prices kept on moving down and recorded their intraday low at 38848.40 in the afternoon and then went into a process of consolidation. The index finally dosed at 38900.15 near its day low with a loss of 770 points. PSU and PVT BANKS both indices have seen a decline today and dosed lower by 2.66% & 1.84% respectively. Within the index, in terms of points, ICICI BANK contributed the highest on the downside followed by HDFC BANK. It was expected as we have seen a few choppy and narrow range days in this week. The short-term trend is still up. Support is visible at around 38000. A dose below this level may change it to sideways or down. Psychological resistance is visible at the 40000 mark. We have been anticipating a dip and that came today. Now we should wait for prices to find support. We will then plan our trade accordingly. Till then avoid trading the index.

TECHNICAL PICKS

DERIVATIVE PICKS

Top Delivery Percentage

UPCOMING ECONOMIC DATA

NEWS UPDATES

• The Nifty 50 snapped its longest winning streak in 21 months on Friday even as it gained for the fifth week in a row, aided by FMCG and energy stocks. Nifty 50 lost more than 1% to close at 17,758.45. The index had gained in the last seven sessions. For the week ended Aug. 19, it gained 0.3%. On Friday, the Sensex fell more than 650 points to close at 59,646.15. The gauge snapped a five-day winning streak.

• Adani Power Ltd. agreed to acquire DB Power Ltd. from the Bhaskar Group at an enterprise value of Rs 7,017 crore, adding to its thermal power capacity. DB Power owns and operates a 1,200-megawatt (2X600 MW) thermal plant at Jahangir Champa district of Chhattisgarh, according to a filing by Adani Power. The project, commissioned in 2015, has long- and medium-term power purchase agreements for 923.

• Oil prices steadied on Friday, but fell for the week on a stronger U.S. dollar and fears that an economic slowdown would weaken crude demand. Brent crude futures settled at $96.72 a barrel, gaining 13 cents. U.S. West Texas Intermediate crude ended 27 cents higher at $90.77. Both benchmarks fell about 1.5 per cent on the week.

• US Stocks fell as short-sellers resurfaced and investors turned cautious after Federal Reserve officials beat the drum on hiking rates. Treasury yields climbed and the dollar rose. The S&P 500 Index extended losses, heading for its biggest daily decline since June. The tech-heavy Nasdaq 100 underperformed major benchmarks, with growth-related stocks among the hardest hit Friday. Meanwhile, Wall Street’s fear gauge, the Cboe Volatility Index, jumped the most in more than two weeks, back above 20.

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

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