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Ahead of Market: 12 things that will decide stock action on Monday

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NEW DELHI: The domestic stock market continues to be choppy as battle between bulls and bears goes on. There are a lot of stock specific reactions that the market is seeing thanks to the ongoing earnings season. Analysts advise caution.

Here’s how analysts read the market pulse:-
A Bearish Engulfing pattern, having placed within a broader range movement, is less of a significance, said Nagaraj Shetti, Technical Research Analyst, HDFC Securities.

On the weekly chart, says Mazhar Mohammad of Chartviewindia.in, the index still looks to be in a consolidation between 17,400 and 16,800 level.

That said, here’s a look at what some key indicators are suggesting for Monday’s action:

Wall Street closes sharply lower
Wall Street slid on Friday to its deepest daily losses since 2020, as Amazon slumped following a gloomy quarterly report, and as the biggest surge in monthly inflation since 2005 spooked investors already worried about rising interest rates.

Earnings, tech rally lift European stocks
European shares on Friday rose to their highest in a week as strong earnings reports and a rally in technology stocks boosted risk appetite at the end of a volatile month dominated by concerns about slowing global growth. The pan-European STOXX 600 index rose 1.1%, trimming its monthly declines to 0.9%.

Tech View: Bullish candle
Nifty50 on Friday formed a Bearish Engulfing pattern on the daily chart and settled below its 200-day and 50-day simple moving averages. On the weekly scale it formed a small bullish candle with a long upper wick, suggesting selling at higher levels.

F&O: Support at 17,000
As per options data, Nifty has support at 17,100 followed by 17,000 while immediate resistances are spread across 17,300 to 17,500 range.

Stocks showing bullish bias
Momentum indicator Moving Average Convergence Divergence (MACD) showed bullish trade setup on the counters of Shriram Transport Finance, GIC, New India Assurance, Shriram City Union, Sapphire Foods and Coforge.

The MACD is known for signaling trend reversals in traded securities or indices. When the MACD crosses above the signal line, it gives a bullish signal, indicating that the price of the security may see an upward movement and vice versa.

Stocks signalling weakness ahead
The MACD showed bearish signs on the counters of Shilpa Medicare, Lux Industries, Paytm, Aster DM Healthcare, Hastsun Agro and L&T Financial Holdings. Bearish crossover on the MACD on these counters indicated that they have just begun their downward journey.

Most active stocks in value terms
Adani Wilmar (Rs 2593 crore), Axis Bank (Rs 2554 crore), Reliance Industries (Rs 2369 crore), HDFC Bank (Rs 1975 crore), Infosys (Rs 1550 crore), ICICI Bank (Rs 1470 crore) and Adani Power (Rs 1279 crore) were among the most active stocks on NSE in value terms. Higher activity on a counter in value terms can help identify the counters with highest trading turnovers in the day.

Most active stocks in volume terms
JP Power (Shares traded: 12 crore), TV18 Broadcast (Shares traded: 12 crore), Visehsh Info (Shares traded: 10 crore), Vodafone Idea (Shares traded: 8 crore), YES Bank (Shares traded: 8 crore) and Adani Power (Shares traded: 5 crore) were among the most traded stocks in the session on NSE.

Stocks showing buying interest
Varroc Engineering, MRPL, Angel Broking, Schaeffler India, Crisil, Varun beverages and Sun Pharma witnessed strong buying interest from market participants as they scaled their fresh 52-week highs, signaling bullish sentiment.

Stocks seeing selling pressure
Dhani Services and Zomato witnessed strong selling pressure and hit their 52-week lows, signaling bearish sentiment on the counters.

Sentiment meter favours bears
Overall, market breadth favoured losers as 1,185 stocks ended in the green, while 2,195 names settled with cuts.

Podcast: Will LIC IPO suck out liquidity from the market?

As the Rs 20,557 crore LIC IPO hits Dalal Street, many market participants fear that India’s largest public issue will suck out liquidity from the market, which is already under pressure from selloff by foreign investors. In today’s special podcast with independent market expert Rajiv Nagpal, let us understand how the IPO may impact the market and whether it is a long-term bet.