Ahead of the first trading session of the week, SGX Nifty was down deep in red, falling 75 points and hinting at a negative opening for domestic equities.
Domestic equity benchmark indices enter this week’s trading session after having moved marginally higher during the previous week. S&P BSE Sensex currently sits at 58,305 while the NSE Nifty 50 is at 17,369. Midcap and smallcap indices outperformed the benchmarks with both the Nifty Midcap 50 and the Nifty Smallcap 50 zooming more than 1% each. Ahead of the first trading session of the week, SGX Nifty was down deep in red, falling 75 points and hinting at a negative opening for domestic equities. Global cues were also negative after Wall Street equity indices closed in red on Friday.
Global watch: The NASDAQ fell 0.87% on Friday while Dow Jones was down 0.78% and the S&P 500 dropped 0.77%. Asian markets were mirroring the fall on Monday morning with Hang Seng down 1.48%. KOSPI, KOSDAQ, Topix, and Nikkei 225 were all down with losses. Only Shanghai Composite was up with gains.
Technical take: During the last trading session Nifty showed a strong bounce from the lows to end in the green. However, on the weekly charts, Nifty formed a small negative candle with minor upper and lower shadow. “Technically, this formation indicate a spinning top type candle pattern at the new highs. As happened in the past, the market could now shift into a broader high low range of around 17600-17200 levels by next week,” said Nagaraj Shetti, Technical Research Analyst, HDFC Securities.
Levels to watch out: “While the medium-term trend is still positive, traders may prefer to book profits near resistance levels due to an overstretched rally. For the bulls, 17250 and 17200 would be key support levels. Above the same, the uptrend formation is likely to continue up to 17450-17650 levels. On the flip side, dismissal of 17200 may fuel further weakness up to 17100-17000 levels. Positional traders can take a contra bet near 17000 support with a strict stop loss at 16930,” said Shrikant Chouhan, Executive Vice President, Equity Technical Research, Kotak Securities.
FII and DII trades: During the previous session Foreign Institutional Investors (FII) were net buyers of domestic equities, pumping in Rs 423 crore. Domestic Institutional Investors (DII) were net buyers as well, pushing in Rs 704 crore.
Normalcy for PSU banks: The Finance Minister has said that the government has managed to bring back normalcy for state-owned lenders when it comes to non-performing assets. The government has not only infused capital into PSU Banks but also carried out reviews to take corrective actions in a timely manner.