Dalal Street fixes its gaze on Budget 2023, FOMC meeting; 10 triggers that could impact Sensex, Nifty on Tuesday
Stock Markets on Tuesday, 31 January 2023: Indian frontline indices S&P BSE Sensex and NSE Nifty50 will resume trading on Tuesday amid a host of local and global triggers. Over the next two-days, street will be watching developments around two major big events – Budget 2023 and Federal Reserve’s FOMC meeting outcome. Zee Business has collated a list of 10 things that could impact movement tomorrow.
Monday Market Recap: Benchmark indices not just ended their 2-day losing streak but also rebounded from 3 month lows on Monday. While the Sensex closed at 59,500.41, up 169.51 points or 0.29 per cent, the broader market Nifty50 closed at 17,648.95, higher by 44.60 points or 0.25 per cent. The banking gauge Nifty Bank also managed a green closing at 40,387.45 finishing 42.15 points or 0.1 per cent higher.
In the 50-stock Nifty50, 29 stocks advanced with Bajaj Finance, Adani Enterprises, UltraTech Cement Company, Bajaj Finserv and Asian Paints ending as top gainers. The top losers were Power Grid, Bajaj Auto, IndusInd Bank, Larsen & Toubro and JSW Steel.
10 triggers that could impact movement:
1) US Markets: Wall Street was trading weak ahead of the FOMC policy announcements scheduled on 1 February. Nasdaq Composite was the worst loser at the time of filing the story and was down by 158 points or 1.36 per cent at 11,463.70 while S&P 500 was trading at 4,045.79, down by 24.77 points or 0.61 per cent. Dow 30 was trading flat at 33,983, up by 4.88 points or 0.01 per cent. Dow Futures were trading at 33,954, lower by 24.10 points or 0.07 per cent.
Singapore-based SGX Nifty, an early indicator of movement in Nifty50 was trading at 17,767.5, up 62.5 points or 0.35 per cent.
When Indian markets resume trading tomorrow, they will take cues from the Thursday closing of US markets and movement on Dow Futures and SGX Nifty futures on Tuesday.
2) Rupee Vs Dollar: The rupee rose by 9 paise to close at 81.50 (provisional) against the US currency in a restricted trade on Monday, supported by a weak greenback in the overseas markets and a decline in crude oil prices.
At the interbank foreign exchange market, the local unit opened lower at 81.69 and touched a low of 81.72 against the US dollar in line with losses in the equity markets, PTI reported.
The dollar index, which gauges the greenback's strength against a basket of six currencies, declined 0.16 per cent to 101.76.
According to the report, a weak Dollar index and a decline in crude oil prices cushioned the downside. Further, FPO-related foreign inflows also supported the rupee at lower levels, he said.
"We expect the rupee to trade with a slight negative bias amid a weak tone in the domestic markets and expectations that the US Dollar may rise on safe-haven appeal," Anuj Choudhary, Research Analyst at Sharekhan by BNP Paribas said.
Choudhary further said that month-end dollar demand from importers and selling pressure from FIIs may also put downside pressure on the rupee. "Traders may remain cautious ahead of India's union budget and US FOMC meeting later this week. USDINR spot price is expected to trade in a range of Rs 81 to Rs 82.20," Choudhary said.
"The rupee remained in a range of 81.50 to 81.72 as it gained after $ selling by exporters due to month end. The dollar index also fell to 101.71 while Brent oil was at $ 86.26. Asian currencies continued to remain range bound," Anil Kumar Bhansali, Head of Treasury at Finrex Treasury Advisors LLP said.
"Range for tomorrow 81.30 to 81.80," he added.
3) Q3 Results 2023: Several listed companies announced their December quarter earnings on Monday. Bajaj Finance reported a 40 per cent jump in its net profit. Among others, PNB, Power Grid, L&T, Tech Mahindra, GAIL, REC, CSB Bank, TCI and others.
Many companies will declare their results on Tuesday. In the Nifty50 Coal India, Power Grid, UPL and Sun Pharma will announce their quarterly results. Among others were ACC, BASF, Edelweiss, Jindal Steel, KEC and Railtel.
4) Stocks in News: Expect stock specific action based on company specific news. Max Healthcare Institute board will meet on 2 February to consider issuance of non-convertible debentures for raising funds; Inox Leisure informs exchanges on the status of merger with PVR. It expects the merger to complete in next 30-40 days. Stocks including SRF, Mangalore Chemicals, Aditya Birla Fashion and others could also see action.
5) Stocks in Ban: Securities in Ban for trade on 31January 2023 is Ambuja Cements.
6) FII / DII Action: Foreign institutional investors were net sellers in Monday and sold Indian equities worth Rs 6792.8 crore while domestic institutional investors were net buyers at Rs 5,512.63 crore.
7) Bulk Deals: Nearly a dozen companies witnessed bulk deal action today. Among them were Atal Realtech, Varanium Cloud, Jet Freight Logistics, Nureca and others.
8) Anil Singhvi Strategy on Nifty and Bank Nifty: Zee Business Managing Editor said that Nifty50 will find support at 17,350-17,400 while resistance at 17,850-17,950. As for Bank Nifty, support is seen at 39,500-39,600 while resistance is seen at 41,000.
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9) Adani Enterprises FPO to end tomorrow. The issue has been overall subscribed 0.03 times. The stock ended at Rs 2878.50 on the BSE, up by Rs 116.35 or 4.21 per cent. The FPO price band is Rs 3,112 to Rs 3,276 per share.
10) Commodity Markets: Dollar movement will be critical to how commodities trade. Movement in Gold price is inversely related to movement in Dollar. MCX April Gold futures were trading at Rs 57,058 per 10 gram, down by Rs 221 or 0.39 per cent while March Silver futures were trading at Rs 68,528 per kg, higher by Rs 199 or 0.29 per cent. February Crude Oil futures were trading at Rs 6,459, down by Rs 47 or 0.72 per cent.
“Given Government’s focus towards clean energy, some measures can be expected to facilitate further electric vehicle (EV) adoption and to support development of EV ecosystem in the country. Apart from this, initiatives to support rural income would also indirectly benefit some segments within the auto industry (mainly entry level two wheeler segment and the tractor segment).” -- Arun Agarwal, Vice President, Kotak Securities Ltd.
"Continuing with the bearish momentum from the last week the Nifty opened gap down & went down to breach the last week’s low of 17493. On the downside it received support near 17400 & recovered sharply towards the end of the session, resulting in a positive daily close. Consequently, the Nifty managed to hold above the 61.8% retracement of the Sept – Dec 2022 rise & 200 DEMA, which are near 17550. This makes today’s low of 17405 a crucial support. On the higher side, the index can test 17800, which will now act as a resistance as per the principle of role reversal." -- Gaurav Ratnaparkhi, Head of Technical Research, Sharekhan by BNP Paribas
“USDINR spot closed 2 paise lower at 81.49 on the back of exporter selling. Over this week, we can see volatility increase, due to major event risks like Budget and Fed.” -- Anindya Banerjee, VP - Currency Derivatives & Interest Rate Derivatives at Kotak Securities Ltd.
"Nifty50 on the daily chart has found support near 17,550 levels which is the 61.80 percent Fibonacci retracement from the low of 16,747 to the high of 18,887 levels. The overall trend remains negative as prices have witnessed a consolidation breakdown below 17,750 levels.
Volatility was the main characteristic of today's session, where prices swung like a pendulum in both directions. As we are in the budget week, volatility is expected to be higher in the next few trading sessions.
The immediate hurdle for the index is currently capped under 17,850 – 17,900 levels. A strong move above 17,900 will again open the gate for 18,050 levels. On the lower side, 17,550 – 17,500 will act as important support for the time being." -- Rohan Patil, Technical Analyst at SAMCO Securities
(Disclaimer: The views/suggestions/advises expressed here in this article is solely by investment experts. Zee Business suggests its readers to consult with their investment advisers before making any financial decision.)
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