Nifty50’s Pause, Infosys Results, and Media Stocks Surge

Technical Overview – Nifty 50

The Nifty50 pauses its prior two days’ bullish momentum and traded in a specific range on the weekly expiry day. The Index witnessed a flat opening near its VWAP levels and traded near 19,800 levels most of the time.

The Benchmark index on the daily chart has witnessed an inverted head & shoulder pattern breakout and the index is sustained above the neckline of the pattern. The index has shown a sustainable reversal from the lower levels after forming a bullish dragonfly Doji candle stick pattern on the daily time frame.

The benchmark index on the daily chart has closed above its 9, 21 & 50-day exponential moving average which is positive for the index. The momentum oscillator RSI (14) has given an inverted head & shoulder pattern breakout on the daily chart and the oscillator has just closed above the pattern’s neckline.

Regarding options, the max OI for calls and puts was at 19,800 and 19,800, with the max pain point rising from 19,650 to 19,800. Buy-on dips will be the preferred strategy for the index with immediate support at 19,650 – 19,600 levels. A sustained move above 19,850 levels will initiate a higher level of 20,000 levels.

Technical Overview – Bank Nifty

It was a range-bound trading session for the Bank Nifty where prices traded near the shade of a 21 & 50 – day exponential moving average on the daily time frame.

The Banking index on the daily chart has witnessed a falling channel pattern breakout on the daily chart and on the broader time frame prices are trading within the triangle pattern. The Banking index is trading marginally above its breakout levels and has taken support of a 100 EMA which is placed at 44,285 levels. The momentum oscillator RSI (14) has given a consolidation breakout on the daily chart and the oscillator has just closed above the pattern’s neckline which is close to 50 levels.

Regarding options, the max OI for calls and puts was at 44,700 and 44,500, with the max pain point rising from 44,300 – 44,500. The positive takeaway from today’s trade was that the Banking Index sustained above its breakout levels. Technically speaking, Bank Nifty’s biggest hurdle for Friday’s trading session is seen at the 44,800 mark. On the downside, the biggest support is seen at the 44,300 – 44,200 mark.

Indian markets:

• The domestic equity market witnessed a rangebound session on Thursday, with limited price movements.
• The benchmark indices opened on a higher note, influenced by positive global cues, indicating a strong market opening.
• Despite the initial gains, the market oscillated within a narrow range throughout the session, resulting in minimal changes in the indices.
• Auto, metal, and energy sectors showed positive momentum, contributing to the market’s stability and indicating investor interest in these sectors. In contrast, IT majors experienced a decline, possibly due to specific market factors impacting the technology sector.
• The broader market indices settled higher, suggesting some sectors outside the major ones performed well and contributed to the overall positive sentiment despite the limited movement in benchmark indices.

Global Markets

• The Dow Jones index futures were up 112 points, indicating a postive opening in the US stocks today.
• European and Asian stock markets continued to rise Thursday, driven by positive global momentum. Investors were particularly focused on key U.S. consumer inflation data, which would influence the Federal Reserves rate decision in its upcoming policy meeting. There were indications that the U.S. Federal Reserve may be hesitant to raise interest rates further, despite a higher-than-expected producer price index. European Central Bank officials also signaled that interest rates may have peaked.
• In the UK, the economy grew as expected in August, with a downward revision to the previous months reading.
• Meanwhile, U.S. stocks closed steady on Wednesday as investors awaited new consumer inflation numbers and Treasury yields declined. Minutes from the September Federal Reserve meeting revealed differing views on further policy tightening, but the consensus indicated the likelihood of another rate hike.

Stocks in Spotlight

• Sula Vineyards saw a 4 percent increase in trade following its announcement of double-digit sales growth in the July to September quarter and the first half of the current financial year. The wine producer reported a significant surge in net revenues, marking its highest ever in Q2. Sula’s own brands experienced impressive year-on-year growth, with net revenue increasing by 14 percent from Rs 102 crore in the previous year to Rs 116.2 crore in Q2FY24. Moreover, the first half of the fiscal year displayed substantial growth, reaching Rs 209.3 crore compared to Rs 172.1 crore in H1FY23.
• Media stocks experienced a significant surge, rallying up to 10 percent, largely attributed to the ongoing ICC Men’s Cricket World Cup 2023. The media sector came into the spotlight as analysts anticipated a substantial boost for select media companies during this nearly two-month-long event, considering the immense popularity of cricket in India. Notably, all 10 constituents of the Nifty Media index were trading higher, indicating a widespread positive trend within the sector.
• Infosys, India’s second-largest IT company, reported a 3 percent year-on-year rise in net profit at Rs 6,212 crore, surpassing Moneycontrol’s poll estimates of Rs 6,156 crore. The company’s consolidated revenue for the quarter stood at Rs 38,994 crore, marking a 7 percent increase and exceeding analyst expectations of Rs 37,694 crore. Despite the positive results, Infosys narrowed its full-year revenue growth guidance to 1-2.5 percent, revising it down from the previous 2.5 percent. This adjustment followed a significant cut in the guidance last quarter, highlighting the company’s efforts to align its projections with the evolving market dynamics.

News from the IPO world🌐

• Plaza Wires lists at 56% premium to IPO price
• Manappuram Finance arm Asirvad Micro Finance files for Rs. 1500 crore IPO
• IRM Energy IPO to open on October 18th

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