Shrikant Chouhan, Executive Vice President, Equity Technical Research at Kotak Securities expects to see volatility in the market, going ahead.
Chouhan is a market veteran of 24 years and has been with Kotak Securities since 2002.
Talking about specific sectors, he said they are bullish on metals. These stocks are available at decent levels and after the Jackson Hole event, we would see fresh buying in the sector, he said in an interview to Moneycontrol’s Sunil Shankar Matkar.
Edited Excerpts:-
Q: Overall the market remained rangebound in the passing week though benchmark indices are near record high levels. What do you expect for the next week?
In the coming week, the market participants will focus on 16,750 (for Nifty) and 16,350 levels. Ahead of the major event, the market has defined the trading range and based on that we would see break out and break down in the market. Above the levels of 16,750, chances of hitting 17,000 would turn bright while below 16,350, the Nifty would fall to 16,000 levels.
Q: The August series was pretty good for the benchmark indices but broader markets saw consolidation and correction. What does the F&O and rollover data indicate about September series?
The rollovers are better-than-expectations and it shows enthusiasm is there in the market. However, stock specific rolls are little less. On the options front, Put writing reduced and Call writing reduced which is an indication of major volatility in the near term.
Q: IT sector was the rock star (followed by FMCG, Oil & Gas, and Power) during the series but Metal was the worst performer. What are those sectors that would be in action in September series?
We are specifically bullish on metals and one need to be with growth stories. Technically, they are available at decent levels and after the closer of the event of Jackson Hole, we would see fresh buying in the sector. We also like pharmaceutical stocks based on their technical formations. Select FMCG and Consumption oriented stocks should do well. In technology stocks some profit taking is not ruled out at higher levels.
Q: More than Rs 18,000 crore of amount raised by companies through IPOs in August but the performance of 6 out of 8 stocks listed in August was weak compared to issue price. Do you expect the same trend to continue in the primary market in September?
No need to worry for strong companies. The listing of the company most of the time depends on the market sentiment. We feel trend to continue for strong companies.
Q: What are key events to watch out for in the month of September and what is your advice to investors/traders for the September?
Auto numbers of commercial vehicles, US Fed meet is scheduled on 22nd of September, CPI, WPI and GDP numbers. The broader trend of the market is still strong, however, in the short term prices have touched to the roof.
It is advisable to buy at major supports. Avoid minor supports. Reduce weak long and leveraged long positions at each minor and major resistance levels.
Nifty would find resistance at 16,750, 16,850 and at 16,970. Support exists at 16,500, 16,350, 16,250 and at 16,000.
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