RepleteBell Market Update

Market Update 18th October

The Nifty snapped a four-day winning streak to end lower on Wednesday, after a rise in bad loans at Axis Bank Ltd sparked concerns about the recovery of stressed assets in the country’s banking sector.

The Nifty ended 0.23 percent lower at 10,210.85, after three straight record-breaking sessions, while the benchmark Sensex closed down 0.08 percent at 32,584.35, its second consecutive session of decline.

Banks suffered the most, especially after Axis Bank, the third largest private sector lender, posted a sharp rise in slippages. The stock itself lost 9.5 percent, followed by ICICI Bank, SBI and Yes Bank that lost 3-4 percent. Nifty Bank was down 332 points, but HDFC Bank (up 0.93 percent) and Kotak Mahindra Bank (up 1.6 percent) outperformed.

Reliance Industries was the biggest gainer among Nifty 50 stocks and ended at a record closing high of Rs 914.50, rising 4.6 percent on value buying.

The market recorded healthy growth in Samvat 2073 as the Sensex surged more than 16.5 percent and the Nifty rallied over 18 percent while the Nifty Midcap gained 19 percent and BSE Smallcap was up 27 percent.

On Thursday, the market will open for one hour for Muhurat trade in the evening between 6:30 pm to 7:30 pm. On Friday, it will remain shut for the Diwali Balipratipada holiday.

Morgan Stanley has maintained its overweight rating on Bajaj Auto and increased price target to Rs 3,785 from Rs 3,251 per share after the company posted impressive Q2 margins.The research house expects EBITDA growth to accelerate to more than 20 percent led by low base and export recovery.Morgan Stanley is positive on the premium bike space in India and mass bikes and three-wheelers in Africa.”EPS estimates hiked by 1.8 percent, 0.8 percent and 0.5 percent for FY18, FY19 and FY20 respectively,” it said.

Gold prices spurted by Rs 290 to 3-week high of Rs 31,000 per 10 grams on the eve of Diwali at the bullion market today on increased buying by local jewellers to meet festive demand.A weak trend overseas however capped the gains.Silver held steady at Rs 41,000 per kg in limited deals from industrial units and coin makers.Bullion traders said increased buying by local jewellers, driven by Diwali festival demand in domestic spot markets, mainly led to rise in gold prices.

Technical summary for 19th October:-

The Nifty5o which opened with a gap on the lower failed to hold on to gains and slipped in red after rallying for four consecutive days in a row on Wednesday. It made a ‘Doji’ type of pattern for the second consecutive day in a row.Doji candlestick pattern signifies indecisiveness between bulls and bears. There is no sign of weakness in Uptrend.

NSENIFTY is long term Bullish as the 144 days moving average of 9,635.34 is increasing. The Relative Strength Index is at 65.65 in the neutral territory. The Relative Momentum Index is at 66.96 in the neutral territory. An important indicator for Elliott waves, the Elliott oscillator is at 181.61, in positive territory; this is a bullish sign. An equally important indicator, the STORSI is at 96.85. This value is in the overbought territory.

An Inside Day Narrow Range was detected on 18-10-2017. This is usually a trade set-up opportunity and for example as the trend is bullish, place a buy-stop at one tick above 10,242.95 and a sell-stop at one tick below 10,175.75.

Additional information

Tomorrow’s projected High: 10,254.00, the projected Low:10,193.30. The top 21-day Bollinger band is at: 10,307.10 while the bottom 21-day Bollinger band is at: 9,728.10.

DISCLAIMER: – we are not a SEBI research analyst. Views posted here only for educational purposes. There is no liability whatsoever for any loss arising from the use of this product or its contents. This product is not a recommendation to buy or sell, but rather a guideline to interpreting specified analysis methods.  This information should only be used by investors and traders who are aware of the risk inherent in securities trading

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