Morning Outlook 8th August, 2022

NIFTY:

The NIFTY opened at 17423.65 with a gap of 41 points. The index initially moved higher but soon started moving sideways and recorded its intraday high at 17474.40. In the afternoon, prices have seen a down move but soon found support and bounced up. However, the rally fizzled out quickly and prices moved down again, erasing all the gains. The gap was also filled and the index recorded its intraday low at 17348.75. Prices have finally dosed at 17397.50 near yesterday’s closing price with a gain of just 15.50 points or 0.9% up. AUTO underperformed today and ended with a loss of 1.09% followed by METAL and PHARMA which ended lower at nearly half percent. IT outperformed today and ended with a gain of 0.64% followed by the BANK which ended nearly half percent up. On the weekly timeframe chart, the NIFTY keeps on moving higher and closed with gains. In fact, for the past seven weeks, the index managed to close higher six times. The short-term trend is up and today’s narrow range suggests a big move is now imminent. On Monday, we should take a trade in the direction of a breakout. The idea is to buy above 17480 or sell short below 17300. In case of a gap, apply the first 15-minute rules. This means your entry price will be the first 15 minutes high or low. Keep a stop of 110 points and a target of 240 points from your entry price.

BANK NIFTY:

The BANK NIFTY opened at 37868.25 with a gap of 181 points. The index recorded its intraday low at 37779.90 in its initial trades and continued moving higher. A rally took the index above 38100 and prices recorded their intraday high at 38150.45. After that price went into consolidation and saw a mild correction to finally close at 37907.25 with a gain of 220 points. PSU BANKS have underperformed today and closed lower by 0.41%. PVT BANKS have outperformed today and ended with a gain of 0.41%. Within the index, in terms of points, ICICI BANK contributed the highest on the upside while HDFC BANK contributed the lowest. Prices have moved in a narrow range this week. This resulted in a narrow trading range on the daily timeframe chart. A breakout may give us to the next directional move. On Monday, we should look for a buying opportunity above 38250 or a shorting opportunity below 37650. Keep a stop of 300 points and a target of 800 points from your entry price. In case of a gap, apply the first 15-minute rule.

TECHNICAL PICKS

DERIVATIVE PICKS

Top Delivery Percentage

UPCOMING ECONOMIC DATA

NEWS UPDATES

• State Bank of India saw its net profit for the April-June quarter drop 7% year-on-year, on lower other income and higher expenses. Net profit for the quarter stood at Rs 6,068 crore, compared with Rs 6,504 crore a year ago. Net interest income, or core income, rose 13.6% year-on-year to Rs 31,196 crore. Asset quality position for the bank remained stable with gross non-performing asset ratio at 3.91%, down 6 basis points sequentially. Net NPA ratio too improved to 1%, compared with 1.02% as of March 31.

• The Reserve Bank of India’s Monetary Policy Committee (MPC) on Friday announced a 50 basis point hike in the repo rate to 5.40 per cent, citing continued upside risks to inflation. The Standing Deposit Facility (SDF) rate is now at 5.15 per cent, while the Marginal Standing Facility (MSF) Rate stands at 5.65 per cent. The SDF represents the lower band of the interest rate corridor and the MSF the higher.

• Gold prices steadied at a one-month high on Friday, ahead of a much awaited U.S. jobs data, as a retreat in Treasury yields and growing recession fears boosted safe-haven demand and kept bullion on track for its third straight weekly rise. Spot gold was flat at $1,790.73 per ounce, as of 0301 GMT, after hitting its highest level since July 5. Prices are up 1.5% this week.

• The sovereign bond market witnessed a sharp sell-off on Friday as the RBI’s unequivocal commitment to bringing down inflation came as a surprise to the market. The yield on the 10-year benchmark 6.54 per cent 2032 paper jumped 14 basis points to close at 7.30 per cent on Friday.

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

BOARD MEETINGS

CORPORATE ACTION

Disclosure in pursuance of Section 19 of SEBI (RA) Regulation 2014

Elite Wealth Limited does/does not do business with companies covered in its research reports. Investors should be aware that the Elite Wealth Limited may/may not have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only information in making their investment decision and must exercise their own judgment before making any investment decision.
For analyst certification and other important disclosures, see the Disclosure Appendix, or go to www.elitewealth.in. Analysts employed by Elite Wealth Limited are registered/qualified as research analysts with SEBI in India.( SEBI Registration No.: INH100002300)
Disclosure Appendix
Analyst Certification (For Reports)
Israil Khan, Elite Wealth Limited, suhail@elitewealth.in
The analyst(s) certify that all of the views expressed in this report accurately reflect my/our personal views about the subject company or companies and its or their securities. I/We also certify that no part of my compensation was, is or will be, directly or indirectly, related to the specific recommendations or views expressed in this report. Unless otherwise stated, the individuals listed on the cover page of this report are analysts in Elite Wealth Limited.
As to each individual report referenced herein, the primary research analyst(s) named within the report individually certify, with respect to each security or issuer that the analyst covered in the report, that:
(1) all of the views expressed in the report accurately reflect his or her personal views about any and all of the subject securities or issuers; and
(2) no part of any of the research analyst’s compensation was, is, or will be directly or indirectly related to the specific recommendations or views expressed in the report.
For individual analyst certifications, please refer to the disclosure section at the end of the attached individual notes.
Research Excerpts
This note may include excerpts from previously published research. For access to the full reports, including analyst certification and important disclosures, investment thesis, valuation methodology, and risks to rating and price targets, please visit www.elitewealth.in.
Company-Specific Disclosures
Important disclosures, including price charts, are available and all Elite Wealth Limited covered companies by visiting https://www.elitewealth.in, or emailing research@elitestock.com with your request. Elite Wealth Limited may screen companies based on Strategy, Technical, and Quantitative Research. For important disclosures for these companies, please e-mail research@elitestock.com.
Options related research:
If the information contained herein regards options related research, such information is available only to persons who have received the proper option risk disclosure documents. For a copy of the risk disclosure documents, please contact your Broker’s Representative or visit the OCC’s website at https://www.elitewealth.in
Other Disclosures
All research reports made available to clients are simultaneously available on our client websites. Not all research content is redistributed, e-mailed or made available to third-party aggregators. For all research reports available on a particular stock, please contact your respective broker’s sales person.
Ownership and material conflicts of interest Disclosure
Elite Wealth Limited policy prohibits its analysts, professionals reporting to analysts from owning securities of any company in the analyst’s area of coverage. Analyst compensation: Analysts are salary based permanent employees of Elite Wealth Limited. Analyst as officer or director: Elite Wealth Limited policy prohibits its analysts, persons reporting to analysts from serving as an officer, director, board member or employee of any company in the analyst’s area of coverage.
Country Specific Disclosures
India – For private circulation only, not for sale.
Legal Entities Disclosures
Mr. Ravinder Parkash Seth is the Managing Director of Elite Wealth Ltd (EWL, henceforth), having its registered office at Casa Picasso, Golf Course Extension, Near Rajesh Pilot Chowk, Radha Swami, Sector-61, Gurgaon-122001 Haryana, is a SEBI registered Research Analyst and is regulated by Securities and Exchange Board of India. Telephone:011-43035555, Facsimile: 011-22795783 and Website: www.elitewealth.in
EWL discloses all material information about itself including its business activity, disciplinary history, the terms and conditions on which it offers research report, details of associates and such other information as is necessary to take an investment decision, including the following:
1. Reports
a) EWL or his associate or his relative has no financial interest in the subject company and the nature of such financial interest;
(b) EWL or its associates or relatives, have no actual/beneficial ownership of one per cent. or more in the securities of the subject company, at the end of the month immediately preceding the date of publication of the research report or date of the public appearance;
(c) EWL or its associate or his relative, has no other material conflict of interest at the time of publication of the research report or at the time of public appearance;
2. Compensation
(a) EWL or its associates have not received any compensation from the subject company in the past twelve months;
(b) EWL or its associates have not managed or co-managed public offering of securities for the subject company in the past twelve months;
(c) EWL or its associates have not received any compensation for investment banking or merchant banking or brokerage services from the subject company in the past twelve months;
(d) EWL or its associates have not received any compensation for products or services other than investment banking or merchant banking or brokerage services from the subject company in the past twelve months;
(e) EWL or its associates have not received any compensation or other benefits from the Subject Company or third party in connection with the research report.
3 In respect of Public Appearances
(a) EWL or its associates have not received any compensation from the subject company in the past twelve months;
(b) The subject company is not now or never a client during twelve months preceding the date of distribution of the research report and the types of services provided by EWL