Stock Market Today:
The Nifty started off the week on a negative note, continuing the downtrend for a fourth consecutive session on April 18 amid weak global cues and selling in IT and banking names.
The index opened gap down at 17,183 and remained under pressure throughout the session as it sank to 17,068. The index saw a bit of recovery in the last hour and managed to defend the 200-day simple moving average (around 17,158). It closed 302 points, or 1.73 percent, lower at 17,174.
The index formed Doji candlestick on the daily charts as the closing was near opening levels, indicating indecisiveness among the bulls and the bears and that bounces were sold in the absence of follow-up buying interest.
IT, banking hit
IT was the biggest loser, falling more than 4.5 percent led by sharp correction in Infosys (down 7 percent) after lower-than-expected March 2022 quarter earnings.
Banking and financial services stocks also saw selling pressure.
Volatility spiked above the 20-mark intraday before closing 8.71 percent higher at 19.34, causing some discomfort to bulls.
“The Nifty registered a Doji kind of formation as it closed near the opening tick after witnessing a huge gap down. In this process, it not only tested its 200-day SMA but also move closer to psychological support present around the 17,000 levels,” Mazhar Mohammad, Founder & Chief Market Strategist at Chartviewindia said.
It was critical for the Nifty to stay above 17,000 but “strength shall not be expected unless it bridges the bearish gap, registered in Monday’s session, present in the zone of 17,237 and 17,457 levels”, he said.
If the index closes below 17,000, it will initially slip to 16,840, where the 200-day exponential moving average is present. For the time, it will be prudent to remain neutral on the index, he said.
Option data indicated that the Nifty50 could see a wider trading range of 16,800 to 17,500 levels in the coming days, which shifted lower from 17,200-17,600 earlier due to correction.
On the option front, maximum Call open interest was seen at 18,000 strike followed by 19,000 strike, while maximum Put open interest was seen at 17,500 strike followed by 16,500 strike.
Marginal Call writing was witnessed at 17,200 strike then 17,400 strike, while Put writing was seen at 17,000 strike then 16,800 strike.
Banking index
The Bank Nifty opened negative by around 600 points at 36,833 and drifted to 36,450. It witnessed some recovery from lows and closed 734 points, or 2 percent, lower at 36,729.
It formed a small-bodied bearish candle with a long lower shadow, which indicates that declines were being bought while selling pressure was intact at higher levels.
“The Bank Nifty has to hold above 36,750 levels to make an up move towards 37,000 and 37,250 levels whereas support can be seen at 36,500 and 36,250 levels,” Chandan Taparia, Vice President | Analyst-Derivatives at Motilal Oswal Financial Services said.
The broader markets, too, ended lower, as the Nifty midcap 100 and Smallcap 100 indices fell more than a percent each.
On the stocks front, a positive setup was seen in NTPC, Hindustan Aeronautics, Bharat Electronics, Jubilant FoodWorks, SBI Life, Torrent Power, Coromandel International, TVS Motor, Adani Enterprises, Dabur, HUL, Indraprastha Gas, ONGC and M&M, said Taparia.
However, Infosys, Tata Power, Mphasis, HDFC, HDFC Bank, Tech Mahindra, Bank of Baroda, L&T Technology Services, Apollo Hospitals Enterprises, TCS, Canara Bank, BPCL and Glenmark Pharma saw weakness, he added.
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