Ahead of Market: 12 things that will decide stock action on Thursday

Ahead of Market: 12 things that will decide stock action on Thursday

NEW DELHI: Nifty made a gap-up opening on Wednesday and saw a strong trading session as the headline index formed a bullish candle with long shadows on the daily chart.

Manish Hathiramani, technical analyst at Deen Dayal Investments said, “The markets might face some resistance around the current juncture. On the downside, 14,600-14,700 has become a good support for the Nifty. If we disrespect this zone, we could break further and go down to 14,200-14,300.”

“Nifty needs to break above the key resistance at 14,900 level. Once that happens, we should see a rally towards 15,300 and beyond that to 15,450 mark. A break above 14,900 level and the coil will unwound and one can expect a swift move,” said Manish Shah, Founder, Niftytriggers.com.

That said, here’s a look at what some of the key indicators are suggesting for Thursday’s action:
US stocks tick higher ahead of Fed minutes

The S&P 500 and the Dow ticked higher on Wednesday, with financial stocks leading gains ahead of minutes from the Federal Reserve‘s last meeting that could offer clues on the central bank‘s views on inflation and an economic recovery. The Dow Jones Industrial Average rose 53.73 points, or 0.16% , to 33,483.97, the S&P 500 gained 4.79 points, or 0.12 %, to 4,078.73 and the Nasdaq Composite lost 7.81 points, or 0.06 %, to 13,690.57.

European shares pause near record high
European stocks hovered near record highs on Wednesday supported by gains in real estate and telecom shares, while optimism over speedy vaccination drives and a weaker pound helped UK equities outperform. The pan-European STOXX 600 index was flat, trading just below the record closing high of 435.26 points on Tuesday.

Tech View: Nifty at an inflection point
Technical analysts believe the stage is set for the Nifty50 to rally above 14,900 level after Wednesday’s jump that came on the back of dovish stance in RBI’s monetary policy. The market breadth saw some improvement and after a long time logged an advance-decline ratio of 4:1. A Long Green Candle closing at the highs of the day suggests buying interest is emerging. Mazhar Mohammad, Chief Strategist at Chartviewindia.in, said, Nifty50 appears to be nearing an inflection point, as it has managed to sustain above its intra-day hurdles placed in the 14,750-800 zone.

Check out the candlestick formations in the latest trading sessions


F&O: VIX falls to 20.24 levels
India VIX fell 2.84% from 20.84 to 20.24 levels. Volatility has to cool down below 20 for buying interest to emerge in the market. On the options front, maximum Put Open Interest was seen at 14,000 level followed by 14,500, while maximum Call OI was seen at 15,000 followed by 16,000 levels. Minor Call unwinding was seen at strike prices 14,800 and 15,000, strike there was Put writing at 14,500 and 13,500 levels. Options data suggested a wider trading range between 14,500 and 15,100 levels.

Stocks showing bullish bias
Momentum indicator Moving Average Convergence Divergence (MACD) on Wednesday showed bullish trade setup on the counters of Bank of Baroda, Ashok Leyland, Union Bank of India, Rail Vikas Nigam, PTC India, Tata Coffee, SBI Life Insurance, GSFC, NOCIL, IIFL Securities, Sterlite Technologies, Apollo Hospitals, Vinati Organics, Havells India, JK Tyre, ICICI Lombard, HDFC AMC, Brigade Enterprises, Ansal Properties,

, Bosch, ADF Foods and Zuari Agro Chemicals.

Stocks signalling weakness ahead
The MACD showed bearish signs on the counters of Dalmia Bharat Sugar, Century Plyboards, Hi-Tech Pipes, Windsor Machines, Aavas Financiers, WABCO India, NBI Industrial Finance and GB Global.

Wednesday’s most active stocks
Adani Ports & SEZ (Rs 8160.91 crore), Adani Enterprises (Rs 2719.92 crore), RIL (Rs 2261.28 crore), HDFC Bank (Rs 1812.66 crore), SBI (Rs 1720.30 crore), Tata Steel (Rs 1498.95 crore), ICICI Bank (Rs 1376.32 crore), Bajaj Finance (Rs 1211.90 crore), Tata Motors (Rs 1205.51 crore) and Graphite India (Rs 1189.91 crore) were among the most active stocks on Dalal Street on Wednesday in value terms.

Wednesday’s most active stocks in volume terms
Vodafone Idea (Shares traded: 16.30 crore), Adani Ports & SEZ (Shares traded: 9.77 crore), PNB (Shares traded: 9.62 crore), Adani Power (Shares traded: 6.10 crore), IDFC First Bank (Shares traded: 5.58 crore), Yes Bank (Shares traded: 5.05 crore), SAIL (Shares traded: 4.81 crore), SBI (Shares traded: 4.80 crore), Vedanta (Shares traded: 4.24 crore) and Bank of Baroda (Shares traded: 4.03 crore) were among the most traded stocks in the session.

Stocks showing buying interest
Happiest Minds, Adani Enterprises, MindTree, Sobha, Aarti Industries, Dabur India, Coforge, Deepak Nitrite, Tata Steel, HEG, Graphite India, Vinati Organics, Sterlite Technologies and Sequent Scientific witnessed strong buying interest from market participants as they scaled their fresh 52-week highs on Wednesday signalling bullish sentiment.

Stocks seeing selling pressure
AKG Exim, GFL Ltd, LCC Infotech, Ortin Laboratories, Suvidhaa Infoserve and Radha Madhav Corporation witnessed strong selling pressure in Wednesday’s session and hit their 52-week lows, signalling bearish sentiment on these counters.

Sentiment meter favours bulls
Overall, market breadth remained in favour of bulls. As many as 373 stocks on the BSE 500 index settled the day in green, while 123 settled the day in red.

Podcast: How will RBI’s QE plans impact D-Street? >>>
The Reserve Bank of India’s monetary policy lifted the spirits of investors that had been sapped recently due to rising concerns over the second Covid wave. The benchmark indices rose nearly 1 per cent after the central bank retained its growth outlook and announced a new bond buying plan to boost liquidity. Rate-sensitive sectors were at the forefront of the gains in the stock market with Nifty Bank, Nifty Auto and Nifty Realty rising over 1 per cent each. We caught up with Lakshmi Iyer, CIO – Debt at Kotak Mutual Fund to make sense of RBI’s policy announcement.

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