News Shots
Vodafone Idea will raise up to Rs 4,500 crore by issuing 338.35 crore preferential equity shares to entities controlled by promoters Vodafone Group Plc and Aditya Birla Group.
SJVN will receive a loan of Rs 1,537 crore from State Bank of India and Rs 319.04 crore from Punjab National Bank for a hydel project in Himachal Pradesh and solar power project in Uttar Pradesh, respectively.
LT Foods has acquired 51% stake in Golden Star Trading Inc. through its subsidiary LT Foods America Inc. with a call option to acquire 49% stake after three years.
IndiaMart Intermesh has entered into an agreement to invest Rs 17.01 crore in Zimyo for 10% stake.
Gujarat Alkalies received a patent from the US Patent and Trademark Office for process for production of hydrazine hydrate.
What to expect?
NIFTY opened with a gap-up at 16,736. But the gap-up was sold into. This was followed by a steeper fall even breaking 16,500 in the second half. NIFTY finally closed the day at 16,498, down 108 points or 0.65%.
BANK NIFTY opened with a gap-up at 35,683 and fell heavily. 34,900 was closely watched by the market participants breaking which we would see a huge fall. But BANK NIFTY was able to close the day at 34,944, down 428 points or 1.21%.
Metals and IT closed in the green.
The US markets closed in the red yesterday. The European markets also moved down.
The Asian markets are down with NIKKEI trading 2% in the red. The U.S. Futures and the European futures are trading lower.
SGX NIFTY is trading at 16,250 indicating a huge gap-down.
NIFTY has supports at 16,370, 16,250 and 16,000. We can expect resistances at 16,570, 16,660 and 16,700.
BANK NIFTY has supports at 34,900, 34,700 and 34,500. Resistances are at 35,230, 35,330 and 35,650.
NIFTY has the highest call OI build-up at 17,500 followed by 17,000 and the highest put OI build-up at 16,000.
BANK NIFTY has the highest call OI build-up at 37,000 and the highest put OI build-up at 35,000.
INDIA VIX is just below 30, at 29.2.
Foreign Institutional Investors net sold shares worth Rs 6,600 crores. Domestic Institutional Investors net bought shares worth Rs 4,800 crores.
As Jerome Powell said on Wednesday that Fed would go for a 25 basis points hike rather than an aggressive 50 basis points hike, the US markets moved higher on Wednesday and that boosted the market sentiments in Asia. As a result, NIFTY opened with a gap-up. The Asian markets closed in the green but our gap-up was sold into. The story does not end there. We fell even further.
The fact that we import 85% of the crude oil draws the correlation of our economy to the crude oil prices. Crude oil had almost touched $120 and this might have been a major factor for the fall. The US futures stood strong when we were falling indicating the localisation of negativity.
FII selling is another major reason. Look at the figures of FII selling for the past days and you will be amused by the aggression.
There were reports that the largest nuclear power plant in Ukraine was attacked by Russia. This led to the drastic fall in US futures which has recovered to an extent now. The Foreign Minister tweeted that if the plant explodes, it could be much more disastrous than the Chernobyl explosion. However, it is reported that the strike was outside the perimeter and the shelling has stopped. Also, there is no radiation level rise at the plant.
The level of 34,900 in BANK NIFTY continues to be the saviour for the market yesterday as well. But we will have to accept the magnitude of negativity in the financial sector. I will be watching 16,250 today.
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