Weekly expiry, Q3 Results, global market action among triggers that may impact Sensex, Nifty on Thursday

Stock Market on Thursday, 9 February 2023: Indian frontline indices S&P BSE Sensex and NSE Nifty 50 responded positively to the Reserve Bank of India monetary policy on Wednesday where the Indian Central Bank increased repo rate by 25 bps, it’s sixth since May 2022. When markets reopen on Thursday for trading, they will take cues from a host of global and local triggers. Zee Business has collated 10 factors that may have a bearing on the movement of benchmark indices.

Wednesday Market Recap

The markets opened positive and build-on the leads as the session progressed. The monetary policy announcements by Reserve Bank of India's Governor Shaktikanta Das were in line with the street's expectations. While Sensex ended at 60,663.79, up by 377.75 points or 0.63 per cent from the Tuesday closing, the broader market Nifty50 closed with 150.20 points or 0.85 per cent gains at 17,871.70. Banking gauge Nifty Bank finished at 41,537.65, up by 46.70 points or 0.11 per cent.

In the 50-stock Nifty50, 38 stocks gained while 12 declined. The top gainers were Adani Enterprises, Adani Ports, HDFC Life, SBI Life and Bajaj Finance while the top losers were Larsen & Toubro, Eicher Motors, Bharti Airtel, Hero MotoCorp and Axis Bank.

Top Triggers

1) US Markets: Federal Reserve Chair Jerome Powell’s exhortation that it would take a while for the US Central Bank to tame inflation did not go down well with the Wall Street. At the time of filing this story all three major indices were trading in the red. Dow 30 was trading at 34,047.80, down by 108.91 points or 0.32 per cent while S&P 500 was down by 33.32  points or 0.80 per cent at 4,130.68. Nasdaq Composite was lower by 155.60 points or 1.28 per cent at 11,958.20.

When markets resume trading tomorrow, they will take their cues from Wednesday’s closing of the US markets and Dow Futures status on Thursday. They were trading at 34,046.50, down 110.20 points or 0.32 per cent.

Investors must also watch out for the movement in Singapore-listed SGX Nifty on Thursday, an early indicator of momentum in the 50-stock Nifty50. They were trading at Rs 17,855, down by 35 points or 0.20 per cent.

 Source: Comex

2) Rupee Vs Dollar: The rupee appreciated 19 paise to close at 82.51 (provisional) against the US dollar on Wednesday after the Reserve Bank of India (RBI) hiked the repo rate by 25 basis points. A rally in the domestic equity markets and weakness in the greenback against major crosses overseas also supported the rupee, forex traders said. However, surging crude prices in the international market and persistent foreign fund outflows restricted the appreciation bias in the local unit, they added. At the interbank foreign exchange market, the local unit opened strong at 82.67 and touched an intra-day high of 82.47 and a low of 82.72 against the greenback. It finally settled at 82.51, up 19 paise over its previous close of 82.70. PTI

"The RBI remained hawkish in its inflation outlook and increased the repo rate by 25 bps. They did not give any guidance on future rate hikes as they wanted to be cautious  in the uncertain world," Anil Kumar Bhansali, Head of Treasury at Finrex Treasury Advisors LLP said.

"Rupee remained in a range of 82.5550/82.7350 even after the monetary policy as RBI Governor said that the currency was very resilient and not much volatile as compared to other currencies. Low volumes seems to be governing the currency at the moment and we expect it to remain in a range of 82.30 to 83.00 for tomorrow," Bhansali said.

 Source: Comex

3) Q3 Results 2023: Samvardhana Motherson, Pennar, Escorts Kubota, Symphony, SKF India, Trent, Shree Cement, NHPC, Adani Power and many other listed companies announced their December quarter results on Wednesday. Expect stock specific action in these companies.

Scores of companies will announce their October-December quarter earnings on Thursday. Among them were Indian Overseas Bank (IOB), IRCTC, Jet Airways, KIMS, MRF, PFizer, Sapphire, Naukri and others. In the Nifty50 pack, Mahindra & Mahindra will post its quarterly earnings.    

4) Stocks in News: Cummins India announced Rs 12 dividend on Wednesday; IRCON International announces dividend of Rs 1.80 per share; Indian Bank revises repo linked benchmark rates by 25bps; RBL Bank approves re-appointment of Rajeev Ahuja as Executive Director for 3 years.

5) Stocks in Ban: Securities in Ban for trade on 9 February 2023: Ambuja Cements, Indiabulls Housing Finance

6) Bulk Deals: Over a dozen companies witnessed bulk deal action on Wednesday. Among them were Tracxn Technologies, SVP Global Textiles, TruCap Finance, Jet Freight Logistics, AKG Exim and others. Investors must keep a track on these stocks when markets open tomorrow.

8) FII / DII Action: Foreign institutional investors were net sellers of Indian equities at Rs 736.82 crore on Wednesday while domestic institutional investors were net buyers at Rs 941.16 crore.

9) Anil Singhvi Strategy on Nifty, Bank Nifty: Nifty will have support at 17,700-17,750 while resistance at 18,000-18.025. Bank Nifty has support at 41,274-41,400 while resistance is seen at 41,825-41,950. The banking gauge will find new momentum if it settles above 42,000.

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10) Tomorrow is also a day of weekly expiry so markets could trade in a range bound manner.  

11) Commodity Markets: Central banks added a whopping 1,136 tonnes of gold worth some $70 billion to their stockpiles in 2022, by far the most of any year in records going back to 1950, the World Gold Council (WGC) said on Tuesday.  The central bank purchases took total gold global gold demand last year to 4,741 tonnes, up 18% from 2021 and the highest for any year since 2011. Commodity analyst Anuj Guta said that this was positive for Gold. Gupta, who is Vice President (VP), Commodity and Currency Research at IIFL Securities recommends a buy on April Gold Futures at Rs 57,000 per gram with a stop loss of Rs 56,720 and price target of Rs 57,500. As for March Sliver futures, buying is recommended at Rs 67,000 per kg with a stop loss of 66,450 and target of Rs 68,000. 

MCX Snapshot

 Source: MCX

Expert Take

“NIFTY made a strong attempt on Wednesday to move above its consolidation zone and was partially successful in doing so. On the lower time frame (60 mins), prices have witnessed a triangle pattern breakout and have closed above the upper band of the pattern.

On the daily scale, the index is trading within the falling channel pattern and is hovering near its 9 & 21 EMA, which is placed at 17,785 & 17, 868 levels respectively. Nifty is still moving within the big budget-day candle from the past five trading sessions.

Technically, Nifty is gathering momentum, reviving bullish hopes, for a test of near-term resistance at 18,000 levels. On the lower side, immediate support for the prices is placed at 17,650 levels." -- Rohan Patil, Technical Analyst, SAMCO Securities

"This morning the global set up was slightly pleasant, and in line with this, our markets started the session on a positive note. The strength continued ahead of the RBI's monetary policy, and since the outcome was very much in line with consensus (rate hike by 25 bps), we witnessed a consolidation thereafter. The buying resumed towards the latter part of the session to eventually conclude with over eight tenths of a percent gains tad above the 17850 mark.

In the last couple of sessions, the benchmark index remained sideways, and today, for the entire session, broad-based buying was clearly visible. This is what we had alluded in our previous commentary that the consolidation is probably a breather and market is likely to make an attempt in the upward direction. However, the banking space remained muted, and barring ICICI Bank, no other banking counter participated in today’s move. Hence, if we have to surpass the sturdy wall of 17900–18000, the banking heavyweights should contribute convincingly. Above which, the market will come out of the recent congestion zone, and we may see good broad-based participation thereafter. On the flipside, 17800 followed by 17700 should now be considered as immediate supports. The remaining two sessions of the week would be quite crucial as it is likely to dictate the near-term direction for our market." -- Sameet Chavan, Chief Analyst-Technical and Derivatives, Angel One Ltd

(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.)