Morning Outlook 24th May, 2022

NIFTY:

Nifty opened at 16290.95 with a gap up of just 24 points. The index initially moved down for the first 30minutes of trading towards the 16200 and then bounced up sharply. Prices have seen an intraday rally of almost 200 points and recorded its intraday high at 16414.70. However, prices have faced strong resistance there and consolidated for about two hours. That consolidation broke on the downside and the index tumbled more than 200 points and recorded its intraday low at 16185.75. Prices have finally closed at 16214.70 with a loss of 51.45 points or 0.32% down.

The volatility is very high as the volatility index ‘INDIA VIX’ is moving around 23 levels. We can see this in the chart also as 50 – 60 points movement within a few minutes is now normal. For stable volatility, it needs to come around 15 – 18 levels. The summary here is we should avoid trading the index and wait for an adequate setup to emerge.

BANK NIFTY:

Bank Nifty opened at 34321.40 without much of a gap. The index continued its bullish momentum from the last week and moved higher. Prices have faced strong resistance around 34800 and moved down after recording its intraday high at 34819.95. The index erases all the gains and moved down below the opening tick to record its intraday low at 34117.35. Prices have finally closed at 34157.80 with a loss of 154 points.

PSU and PVT BANKS both have performed almost the same today, saw a minor decline, and closed lower by 0.34% & 0.03% respectively. Within the index, in terms of points, KOTAK BANK contributed the highest on the upside while HDFC BANK contributed the lowest.

The range is wide enough and likely to remain intact for a couple of weeks. Of course, it is our anticipation and it could be wrong. However, we still need to wait for prices to stabilize as the volatility is very high. The summary is to avoid trading the index and wait for an adequate setup to emerge. We have mentioned that a trading range is now visible inside the support at 33000 and resistance at 35000. The index today faces resistance near 35000 and is turned down

TECHNICAL PICKS

DERIVATIVE PICKS

Top Delivery Percentage

UPCOMING ECONOMIC DATA

NEWS UPDATES

• Maruti Suzuki India (MSI) on Monday said it will acquire an equity stake of 12.09 per cent in Sociograph Solutions Pvt Ltd (SSPL) for about Rs 2 crore. SSPL is an artificial intelligence (AI) software company that specialises in visual AI platform predominantly used to help enterprises improve sales experiences and improve efficiency in their business.
• ArcelorMittal Nippon Steel India Ltd expects about 90,000 tonnes of steel exports every month to be hit by government’s duty increase, alongside a dampening effect on fresh investments, Dilip Oommen, chief executive officer, said on Monday. “Export duty imposed by Indian government will have repercussion on company’s export market,” Oommen told Reuters, adding, the company exports 15% of its total production. Oomen is also president of the Indian Steel Association.
• Mahindra and Mahindra will explore sourcing more components from other companies to boost its electric vehicle (EV) portfolio, its chief executive told Reuters. Anish Shah said Mahindra had over time focussed on developing EV components in-house, but now changed tack to forge partnerships to achieve faster growth in the segment. Mahindra last week signed a partnership agreement with Volkswagen in which it will explore equipping its electric cars with motors, battery system components and cells made by the German automaker.
• RBML – the joint venture of Reliance Industries Ltd and supermajor BP – has told the government that fuel retailing for the private sector in India has become unsustainable after market-controlling public sector firms frequently froze petrol and diesel prices at rates way below the cost, sources said.

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

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