Dalal Street Corner: Nifty closes above 17200 levels on F&O expiry day; What should investors do on Friday?

The Indian markets closed flat-to-lower on the F&O expiry day on Thursday pushing benchmark indices towards crucial support levels. The S&P BSE Sensex failed to hold on to 58000 levels, while the Nifty50 closed marginally above 17200.

The Nifty50 index fell by 1.9 per cent in the December series, while Nifty Bank saw losses of over 6 per cent in the same period, data showed.

The S&P BSE Sensex had a touch-and-go moment with 58,000 but selling pressure at higher levels pushed the index lower. The fall was led by losses in RIL, Tata Steel, Maruti Suzuki, and Bajaj Finance.

The Nifty50 bounced back after hitting a low of 17,146 to close above 17,200 levels, but it is still trading below the 50-DMA placed at 17,535.

"It has been quite a volatile month for Nifty, wherein Nifty fell to a low of 16,400 at the same time has also seen a high of 17,600. FIIs have sold equities worth almost $2.7 billion in the month of December,” Rahul Gupta, AVP-Derivative Sales, Institutional Equity, Emkay Global Financial Services, said.

“This is the 3rd consecutive month wherein FIIs would be the net sellers. Overall, FIIs continue to be the net sellers for the entire year 2021. Going forward the key technical level to watch out for Nifty would be 17,600 on upside and a break of 16800 will ensure a fresh selling in the market,” he said.

The Nifty50 looks to be trading in a range of 16800-17600.

Sectorally, buying was seen in IT, healthcare, consumer durables, and telecom stocks while selling pressure was visible in energy, oil & gas, and metals.

On the broader market front – the S&P BSE Mid-cap index fell 0.2 per cent, and the S&P BSE Small-cap index was up 0.19 per cent.

We have collated views from various experts on important levels to track on Nifty, and NiftyBank:

Expert: Sachin Gupta, AVP, Research at Choice Broking

On the technical front, the index has been trading in falling channel formation, crossing above the upper band of formation can show an upside rally in the counter.

Moreover, the index has been trading above 21 & 50-HMA which suggests strength in the counter. A momentum indicator Stochastic & MACD is trading with a positive crossover on the daily time-frame.

At present, the Index has support at 17000 levels, while resistance comes at 17300 levels, crossing above the same can show 17400-17500 levels. On the other hand, Bank nifty has support at 34500 levels while resistance at 35500 levels.

Expert: Mohit Nigam, Head - PMS, Hem Securities

Overall, global markets were mixed today as investors are uncertain about the consequences of surging Covid 19 cases in different parts of the world.

On the technical front, overall structure looks positive for the Nifty50 as it managed to sustain above 17200 level on a closing basis which is a positive sign for the index.

Technically, we believe that we can witness a 200-300 point rally from here in the near term. The level of 17000 and 17400 are immediate support and resistance in Nifty. For Bank Nifty, 34500 and 35500 are immediate support and resistance.

Expert: Vinod Nair, Head of Research at Geojit Financial Services

Domestic bourses witnessed a choppy session lifted by gains in IT and healthcare stocks on the day of the monthly F&O expiry.

Globally, markets were mixed as investors are weighing the consequences of a third wave amid surging inflation worldwide.

Banking stocks, especially PSUs, were under pressure as RBI’s financial stability report suggested a surge in bad loans with NPA’s rising from 6.9% in September 2021 to 8.1% in September 2022 under the base case scenario.

(Disclaimer: The views/suggestions/advices 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.)