Prashanth Tapse – Research Analyst, Senior VP (Research), Mehta Equities:
Markets continued with the positive momentum as Nifty & Bank Nifty closed decisively higher. The positive takeaway was that the benchmark Nifty and many momentum stocks shined all-throughout the day as risk flows dominated the trading theme. The buying stampede simply continued. GST collections that rose 28% to Rs 1.49 lakh crore on an annual basis in July also provided a fillip to the markets. The simple strategy on the benchmark Nifty is to establish long positions and remain a buyer as long as Nifty trades above its biggest interweek support at 16821 mark.
Ajit Mishra, VP – Research, Religare Broking Ltd
Markets started the week on a positive note, in continuation to last week’s trend and ended with gains of nearly one percent. Supportive global cues as well as healthy buying across sectors led the benchmark to gradually inch higher as the day progressed. The Nifty ended with strong gains of 17,340 levels, up by 1.06%.
Amongst the sectors, except pharma, all the sectoral indices ended in the green with auto, energy and media ending as top gainers. The broader market, midcap and Smallcap too ended higher in the range of 1.7-1.8%.
This week markets will continue to take cues from on-going earnings as well as global peers. Besides, RBI monetary policy outcome scheduled on 5th August will be crucial for market participants. We would advise investor’s to focus on maintaining a stock specific approach.
Gaurav Ratnaparkhi, Head of Technical Research, Sharekhan by BNP Paribas:
The Nifty continued with its winning streak from the last week. Although the hourly momentum indicator has developed negative divergence, the price action itself continues to be resilient. On July 29, the Nifty had scaled above the 61.8% retracement of the Apr – June decline & the 200 DMA. It is now trading near 61.8% retracement of the entire Oct 21 to June 22 decline i.e. 17300 & is inching towards the 78.6% retracement of the Apr – June fall i.e. 17500. On the other hand, the near term support zone shifts higher to 17100-17150 with reversal for the bullish stance pegged at 17000.
Vinod Nair, Head of Research at Geojit Financial Services:
FPIs turning net buyers is the major factor driving the uptick in the domestic market. Record low unemployment rate in the Eurozone and fall in crude oil prices, increased optimism globally.
Oil prices took a hit as the deteriorating demand outlook outweighed cues of ongoing supply tightness. Auto stocks were in focus post the release of positive auto sales numbers.
Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities:
Strong global cues and optimistic vehicle sales numbers from select frontline automobile companies fuelled another round of rally in domestic equities. The overhang of the US policy rate decision is now behind us and the focus is now on the RBI policy meeting later this week where traders expect the rate hike could be on expected lines.
Moreover, the return of FII inflows into the local equity markets has also brought back some amount of cheer amongst the investors. Currently, the Nifty is comfortably trading above the 200-day SMA and is still holding higher high and higher low formation on intraday charts.
However, since the market is in a temporary overbought condition, we could see a quick intraday correction in the near term. For traders, 17250 would act as a key support level, above which the index could move up to 17450-17500 levels. On the flip side, a quick intraday correction is possible below 17250, below which the index would retest the level of 17150-17100.
Rupak De, Senior Technical Analyst at LKP Securities:
The uptrend continues in the market as the bulls’ invasion of the 17000-17500 zone continues. The trend is likely to remain positive as long as the benchmark index sustains above 200 DMA, placed at 17025.
Over the near term 17000 is likely to act as crucial support; whereas on the higher end, 17500 may act as crucial resistance. Again, above 17500, the Nifty may move up towards 18000.
Market Close: Indian equity benchmark indices ended higher for the fourth consecutive day on August 1 with Nifty closing above 17,300 on the first day of the new series.
At Close, the Sensex was up 545.25 points or 0.95% at 58,115.50, and the Nifty was up 181.70 points or 1.06% at 17,340. About 2230 shares have advanced, 1145 shares declined, and 187 shares are unchanged.
Tata Motors, M&M, Adani Ports, ONGC and UPL were among the major gainers on the Nifty. The losers included Sun Pharma, HDFC Life, HUL, Britannia Industries and Divis Labs.
All the sectoral indices ended on positive note with Auto, Power, and Oil & Gas indices gained 2-3 percent.
The BSE midcap and smallcap indices added over 1 percent each.
Rupee Close:
Indian rupee ended higher by 24 paise at 79.02 per dollar against 79.26 per dollar.
Nifty rallies 14% in 1.5 months to hit 17,300 points. Is it time to book profits?
With the consistent rally and holding on to previous days’ low points, the support for the Nifty has also shifted higher to 17,033, followed by 16,950 levels
Geojit on Ujjivan Small Finance Bank:
Ujjivan Small Finance Bank has turned its focus back to growth after recovering from the impact of pandemic. With improved asset quality and strong provisioning cover, the bank is poised to show case strong growth.
Management expects the banks advance book to grow at 30% during FY23. Bank was also able to diversify its portfolio towards more secure book with increased focus on formal segment. With robust top line growth along with normalising cost to income ratio and lower credit cost, the company is set to witness increased profitability.
Considering rebound in return ratios, and current low valuation, we maintain our Buy rating based on 1.1xFY24E Adj.BVPS with a target price of Rs 24.
BSE Midcap Index added 1 percent supported by the IDFC First Bank, Gujarat Gas, Sona BLW Precision Forgings
Bharat Electronics to consider bonus issue on August 4
A meeting of the board of directors of Bharat Electronics is scheduled to be held on Thursday, the 4th August, 2022 to consider a proposal for issue of Bonus Shares to the equity shareholders of the company.
Bharat Electronics touched 52-week high of Rs 286.50 and was quoting at Rs 286.45, up Rs 11.40, or 4.14 percent.
