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Weekly Reports

10-Feb-24 Technical & Fundamental Insight

Last week – review

Going into trade last week, we were cautious as market rally seems to be showing some sing of weakness post Budget on 1-Feb-24.  We see budget as non-event as there was no major expectation as it was Vote-On-Account ahead of general election in April – May 2024.  Market this week ended with minor cuts as RBI MPC policy was due this week.

Technical Insight

• Nifty in last two week has been trading in range of 21411 to 22115, Nifty has made double top on last Friday would act as resistance level.  Nifty range expected this week is 21680 to 22115.

• Banknifty range for this week is expected to be 45295 to 46571.  Any major move in Banknifty expected once this range is broken on either side.

Approach on Technical: Indian market reacted to Budget last week and RBI MPC policy this week.  We expect indices to follow technical direction as there are no major scheduled event, outcome of which can impact market direction.

Nifty @ 21680 & Banknifty @ 45295 to act as important support level.  If indices break this level – fresh downside could be expected, otherwise we see indices could attempt fresh up move.

Fundamental Insight

RBI Monetary Policy Key Takeaways

• To keep the repo rate unchanged at 6.5% by a 5:1 majority.
• The standing deposit facility rate, pegged 25 basis points below the repo rate, is at 6.25%.
• The marginal standing facility rate, which is 25 basis points above the repo rate, is at 6.75%.

The MPC also decided to remain focused on the withdrawal of accommodation to ensure that inflation progressively aligns with the target, while supporting growth.

India To Sell $11.6 Billion Airwaves to Boost Phone Networks

India’s federal cabinet Thursday approved a plan for selling airwaves in an auction to improve quality and coverage of networks in the world’s second-biggest telecom market.

Forex Reserves Jump To $622.469 Billion

India’s forex reserves jumped by $5.736 billion to $622.469 billion for the week ended Feb. 2, the Reserve Bank said on Friday. In the previous week, the overall reserves had increased by $591 million to $616.733 billion.

Equichain Wealth Advisors: Market View & Strategy

We have remained cautious in last few weeks and continue to remain cautiously optimistic but will continue to follow strategy of fresh allocation on correction.  

We see market at current level has factored in political stability, US fed pivot on interest rate and earnings season so far has failed to provide fresh positive triggers.  Rally in PSU stocks continue on optimism of political stability, but we do believe valuation are stretched in near term.

We would continue to keep exposure around 75% and major allocation would be preferred on correction.  We may review our stance incase indices hit fresh high supported by some positive triggers on interest rate going down or any other substantial news which could change market narrative.

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27-Jan-24 Technical & Fundamental Insight

Last week – review

Market going into 3-day trading week with F&O expiry and profit booking seen in previous week, we expected this week to resume uptrend as ICICIBANK result was in-line with market expectation.  Indices seen yet another week of profit booking as Banknifty continue to remain week as HDFCBANK remain weak closing at 1434.90 which is around 15% correction from 16-Jan-24 close.

Technical Insight

• Nifty expected to be in range of 20976 on lower end while fresh up move could be expected once Nifty crosses 21680.  
• Banknifty range for this week could be seen as 43230 on lower side while fresh up move could be expected once Banknifty sustains above 46571.

Approach on Technical: This week again news flow will drive the market as US FOMC meeting outcome on 31-Jan-24, Indian market will be reacting to it on 1-Feb-24 and Budget ahead of general election will be on 1-Feb-24.

Technical setup is weak and it indicates further downside.  Nifty @ 20976 & Banknifty @ 43230 on lower side could be tested this week.  Nifty @ 21680 & Banknifty @ 46571 could be tested on higher side.  VIX @ 13.86 will be important tool and need to turn cautious if VIX goes above 16.

Fundamental Insight

1) LIC Gets RBI Nod to Acquire 9.99% Stake in HDFC Bank
2) Cabinet Approves Rs 8,500 Crore Incentive Scheme For Coal Gasification Projects: Sources
3) Forex Reserves Fall By $2.8 Billion To $616.1 Billion, Says RBI
4) Budget 2024: Government Likely to Target 5.3% Fiscal Deficit Target for FY25, Say Economists

Equichain Wealth Advisors: Market View & Strategy

This week, US FED meeting outcome on 31-Jan-24, Indian market will react to it on 1-Feb-24 along with Union budget ahead of general election on same date 1-Feb-24.  So, we expect any major move is expected on 1-Feb-24.  

Our strategy would be to focus on keeping exposure around 70% and have balancing approach where we remain positive with medium to long term view and cautious in short term.  Technical setup looks bearish and any lack of positive trigger may lead to correction.  

When we see recent rally, which is seen from December 2023, state election result on 3-Dec-23 and US Fed guided that rate hike may done has triggered the ongoing rally.  We have mentioned earlier also that now focus will shift to earning season which has been mixed so far.  We believe post budget – market could see profit booking as run-up in PSU ‘s has been one of the best rallies seen in recent past.  

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Daily Reports

Daily Report 6-Jul-23

Wall Street had muted session with minor cuts as US FOMC meeting minutes revealed hawkish signal and indicated rate hike on 26-Jul-23, next US Fed meeting.

Reacting US FOMC meeting outcome, US 10-year bond yield is now trading a 3.95% & Dollar index at 103 indicates further rate hike expected.

Crude oil prices remain steady, WTI Crude @ $72 & Brent crude trading around $77 level.  Base metal prices remain stable.

F&O data: FII added 4605 contracts in index futures, net long position now at 72.39%.  Nifty PCR @ 1.37 Vs 1.47 previous.  Banknifty PCR @ 1.08 Vs 1.38 previous.

Approach on Indices: GIFTNIFTY indicate flat to negative start, with weekly F&O expiry, today could be a day of big correction which is overdue for some time now.  On lower side Nifty @ 19154 & Banknifty @ 44530 to act as strong support level.  

GIFTNIFTY @ 19488 down 24 points at 8:00 AM

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Daily Report 5-Jul-23

U.S. market was closed on 4-Jul-23 for Independence Day.  Monthly economic data will be released later this week and US FOMC meeting minutes to be released tonight.

HDFCBANK quarterly business updates shows mix trend on merge entity.  HDFCBANK standalone business updates – loan growth at 15.8% & deposit growth at 19.2%.

LTIM to replace HDFC in Nifty from 13-Jul-23.  HDFC to de-list at trade as merge entity with HDFCBANK from 13-Jul-23.

F&O data: FII long position now stands at 71.89% or by 89765 contracts.  Nifty PCR @ 1.47 Vs 1.48 previous and Banknifty PCR @ 1.38 Vs 1.39 previous.

Approach on Indices: Run-up on indices is too fast supported by short covering, we would wait for correction to take fresh long and expect correction from current level.

GIFTYNIFTY @ 19498.50 up 5 points at 8:40 AM

Market View: Broder market sees some sign of consolidation; we would continue to follow strategy to increase cash level on rally and take opportunity to take fresh view on long position on correction & consolidation.  Q1FY24 result season will be key and provide further cues.  Quarterly business updates so far has been in-line with recent rally.

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Daily Report 4-Jul-23

Wall Street had muted session in a holiday shorten session followed by holiday on 4-Jul-23 on U.S. Independence Day.

Quarterly business updates from BAJFINANCE recorded growth of 32% on yearly basis.  In Q1FY23 recorded highest ever AUM growth.

IDFC & IDFCBANK set to merge: IDFC Ltd share holder to get 155 shares of IDFCFIRSTB against 100 shares of IDFC.

VIX @ 11.54: moved above 11 as market witness profit booking.

Approach on Indices: Momentum remains strong, but looks stretched from current level.  We would wait for correction / consolidation for fresh entry.   GIFTNIFTY indicate flat opening and we expect indices to see some selling pressure / supply at current level.

GIFTNIFTY @ 19456 up 17 points at 8:15 AM

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Daily Report 3-Jul-23

Wall Street continue to rally on Friday ahead of holiday shorten week in US and major jobs data by end of this week.  NASDAQ was up by 1.45% as tech stocks continue to do well.

China’s Caixin PMI continue to show weakness, eased to 50.5 from 50.9 indicate marginal expansion as 50 level mark separates expansion from contraction.

SGX Nifty to trade as GIFT NIFTY from 3-Jul-23, derivative contract with notional value of about $7.5 billion will shift to GIFTNIFTY.

F&O Data: FII added 16333 contracts in index futures, net long position now stands at 72433 contracts.  Net long: short contract now stands at 69.21%:30.79%.

Approach on Indices: Indices in unchartered territory, Nifty @ 19362 & Banknifty @ 44959 could be next target / resistance level and support level on Nifty @ 18932 & Banknifty @ 44253.

GIFTNIFTY @ 19365 up 20 points at 8:20 AM

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Daily Report 30-Jun-23

Wall Street gain on Thursday as bank outperforms and tech stocks take a breather after outperformance in recent times.  S&P500 index up by 0.45%.

HDFCBANK & HDFC lead the indices to new high as merger date finalized.  HDFCBANK & HDFC is all set to merge effective from 1-Jul-23 & will trade as merge entity from 13-Jul-23 likely.

US 10-year bond yield rises to 3.84% & Dollar Index currently trading at 103 after comment of Fed chair on further rate hike by end of year.  China’s PMI shrinks for the third straight month in June.  

F&O data: FII rollover @ 87%, net long: short remains at 66.42%:33.58%.  Nifty PCR @ 1.41 & Banknifty PCR @ 1.30.

Approach on Indices: SGX Nifty indicate flat to positive opening, could continue to see positive movement, but we would wait for dip or correction any fresh entry

SGX Nifty @ 19185 up 35 points at 8:00 AM

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Daily Report 27-Jun-23

Wall Street ended with losses as NASDAQ was down by 1.16% as recession fear as investor believes that aggressive rate by US Fed could lead to economic slowdown.

Mid-cap 100 was up by 0.92% & Small-cap up by 0.62% indicate positive momentum may continue after negative close last week.

Commodity continues to remain near lower as China’s recovery fail to cheer the market.

F&O data: FII net buyer by 2023 contract in index futures, net long: short position remains at 53.26%:46.74%.  Nifty PCR @ 0.93 Vs 0.93 previous.  Banknifty PCR @ 0.84 Vs 0.88 previous.

Approach on Indices: Indices trading in narrow range with low volatility for quite some time now, we expect some increase in volatility as just two trading day for F&O expiry for June series.

Market View: We would prefer to book profit and reduce exposure and wait for better clarity.  Market seeing supply at higher level as global cues remain mix and no much fresh news to guide market in near term.  

SGX Nifty @ 18736.50 up 32.50 points at 8:00 AM

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Daily Report 26-Jun-23

Wall Street was down by 0.65% to 1.01% as economic worries continues to weigh on sentiment.  Rate hike of 50-bps to 5.00% by BOE surprised market participant.

Russia’s political crisis seems to be de-escalated over the weekend but may continue to remain an important geo-political event to watch out for, crude oil rises on Monday morning as supply may be impacted.

SGX Nifty indicate flat opening going into trade on Monday morning for final F&O expiry for June series.

VIX @ 11.24: continue to trade near lower end of the range.

Approach on Indices: Technical do indicate further correction and consolidation and Nifty @ 18567 & Banknifty @ 43314 could act as important support level, below these indices could witness further downside.

Market View: There are very little cues from global as well domestic market as indices continue to trade in narrow range, Mid-cap & Small-cap corrected after 12 weeks of gain and we think further correction in Mid-cap & Small-cap likely. 

SGX Nifty @ 18718 up 3 points at 8:25 AM

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Weekly Reports

24-Jun-23 Technical & Fundamental Insight

Last week – review

Going into trade this week, trend remain mix as indices was trading near its recent highs, BSE Sensex made fresh and manage to cross December 2022 high while Nifty is yet to make fresh lift-time high.  Market witness profit booking and selling pressure from higher level, Mid-cap & Small-cap were looser on weekly basis after 12 weeks of continuous gains.

Technical Insight

 Nifty RSI @ 54.84 & RSI average @ 62.25, Nifty RSI indicating negative trend in near term with 18567 as first support level & 18374 as intermediate support level.  

• Banknifty RSI @ 47.92 & RSI average @ 51.38.  Banknifty is trading below its 20-DMA @ 43956 which is now acting as resistance level.

Approach on Technical: Indices are currently trading near upper-end of the range and facing supply ahead of F&O expiry next week for June 2023 series.  

Nifty below 18567 & Banknifty below 43314 could open further downside which could test lower level on Nifty @ 18131 & Banknifty @ 42493.  This week could turn out to be broader correction, while uptrend would resume in case of Nifty manages to move above 18807 & Banknifty above 44046.

Fundamental Insight

1) RBI Nowcasting Model Pegs Q1 FY24 GDP Growth At 7.9%
2) MPC Minutes: Job to Contain Inflation Only Half-Done, Says RBI Governor
3) EPFO Adds 17.20 Lakh Net Members In April: Labour Ministry

Equichain Wealth: Market View & Strategy

We believe it’s time to book profit and reduce exposure, with Q1FY24 result season to begin from 2nd week of July, market will focus on final F&O expiry and global cues.  We have reduced our exposure around 75%, but will continue to maintain allocation around 70% on lower side and 85% on higher side.  

Going into final F&O expiry for June series, we expect market to correct / consolidate at lower level which could provide fresh entry opportunity.

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24-Jun-23 Fundamental & Technical Insight.pdf
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