Will Nifty 50 bear the brunt of global headwinds and geopolitical tensions?

Monday was only the second time in September that the Nifty 50 ended the day with losses. Throughout the September series, the Nifty 50 surged despite multiple negative global signals such as rising crude oil prices and the US dollar index surging past the 105 mark.

Another cause for concern is the fact that Monday’s intraday highs and lows were below Friday’s levels. Wednesday would also be the weekly expiration of Nifty Bank options contracts.

What do the experts say?

Nomura’s Chetan Seth said the market will mainly focus on the FOMC results. While the Fed is widely expected to maintain key rates, the market will focus on the new dot plot projections and Jerome Powell’s press conference. “We do not necessarily believe that this would be a hawkish outcome beyond any knee-jerk decision,” he wrote.

“The market is showing strength and holding above 20,000 levels. Overall, we expect the market to move up gradually with minor profits recorded at regular intervals,” said Siddhartha Khemka of Motilal Oswal.

What do the Nifty 50 charts suggest?

The Nifty 50 ended Monday’s session lower but managed to stay below the 20,100 mark.

Nagaraj Shetti of HDFC Securities said the short-term trend in the Nifty 50 is poised to reverse lower. A decisive move below 19,940 could confirm further near-term weakness, he said, but added that strong selling momentum is ruled out. Immediate resistance to the upside lies at 20,220.

“The sideways trend in the Nifty 50 is likely to persist in the coming trading sessions,” said Kunal Shah of LKP Securities. For now, the index has support at 20,100 and resistance at 20,200 and a breakout on either side could lead to trending moves.

Nifty Bank struggles above 46,000

The Nifty Bank closed below the 46,000 mark on Monday, ending a three-day losing streak. Multiple attempts to close above its all-time high of 46,369 were met with only upward resistance. Monday’s low for Nifty Bank was also below the 46,000 mark, although it found some support at 45,900.

Kunal Shah of LKP Securities said that the 45,800 – 45,700 zone is a key support for the Nifty Bank below which further selling pressure can be seen in the index. “Despite the profits recorded, the overall sentiment towards the index remains bullish as long as it remains above these support levels,” Shah said.

More benefits in store for PSU banks?

“Our approach is very clear: we want to invest in companies that have historically had very good business quality and have expectations of sustainable growth and many of these banks do not meet these criteria,” Vinay Paharia of PGIM India Mutual Fund. said CNBC-TV18.

What do F&O signals indicate?

September futures of Nifty 50 lost 2.1 per cent and 2.21 lakh shares in Open Interest. They are now trading at a premium of 45.55 points compared to 57.25 points previously. On the other hand, Nifty Bank September futures lost 7.9 percent or 1.28 lakh Open Interest shares. The Put-Call ratio of Nifty 50 is now 1.1 compared to 1.31 earlier.

PNB and Delta Corp entered the F&O Ban list from Wednesday’s session, while Hindustan Copper and India Cements are out of the list. Indiabulls Housing Finance, Balrampur Chini, BHEL, Zee Entertainment, Manappuram Finance, IEX, REC and Chambal Fertilizers remain on the banned list.

Nifty 50 Call side for September 21 expiry:

For this Thursday’s expiration, Nifty 50 calls between 20,150 and 20,300 saw an addition in open interest, with the 20,200 call price seeing the largest addition.

StrikeChange of ROPrime
20,20038.34 Lakh added45.55
20 15025.3 Lakh added69.15
20,25023.67 Lakh added28:55
20,30016.75 Lakh added5:65 p.m.

Nifty 50 on Put side for September 21 expiry:

For the put side, Nifty 50 strikes between 19,900 and 20,200 saw the addition of Open Interest, although this was a small amount compared to the addition of Open Interest on the Call side.

StrikeChange of ROPrime
20,20010.04 Lakh added94.25
20 10010.71 Lakh added47.75
19,90016.74 Lakh added9:55 a.m.

Let’s look at stocks that added new long positions on Monday, meaning an increase in price and open interest:

ActionPrice changeChange of RO
Dr Lal Pathlabs0.80%10.85%
Hindustan Aeronautics0.69%6.66%
JK Cement1.18%5.77%

Let’s look at stocks that added new short positions on Monday, meaning a drop in price but an increase in open interest:

ActionPrice changeChange of RO
IPCA Laboratories-0.97%27.88%
Delta Corp.-2.20%13.64%
SBI Cards-2.36%11.39%

Some stocks experienced short covering on Monday, meaning an increase in price but a decrease in open interest:

ActionPrice changeChange of RO
HDFC Life2.00%-5.17%
Gas Mahanagar0.09%-5.10%

Here are the stocks whose long positions were unwound on Monday, meaning a decline in both price and open interest:

ActionPrice changeChange of RO
Chambal Fertilizer-2.02%-8.70%
Persistent systems-1.85%-5.65%
Bandhan Bank-1.44%-4.95%

Here are the stocks to watch ahead of Monday’s trading session:

  • Tata Engines: Increase the prices of its utility vehicles by up to 3% from October 1, 2023.
  • HDFC Bank: Sashidhar Jagdishan has been reappointed as Managing Director and CEO of RBI for three years.
  • Trusted Industries: Jio launches JioAirFiber services in eight metro cities across India.
  • Blue Star: Launches QIP to raise Rs 1,000 crore. The floor price of Rs 784.55 represents a reduction of 2 percent from Monday’s close.
  • DCM Shriram: Fenesta enters into technical partnership with Inventure Metal Products Industries LLC of UAE to develop facade industry in India.
  • BL Kashyap: Receives new orders worth nearly Rs 167 crore from Delhi International Airport. The total order book as of today is Rs 3,005 crore.
  • IRFC: Shelly Verma’s tenure as additional CMD has been extended by six months from October 15. Verma is currently Director (Finance).
  • Prakash Industries: Environment Ministry grants permission for Bhaskarpara commercial coal mine in Chhattisgarh.
  • Biocon: Peter Bains is appointed CEO of the group from September 18.
  • CCNB: Gets Rs 150 crore work order from Khadi & Village Industries Commission.

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