Dear
Trader…
Domestic
equities had weak handover from its global peers as high US inflation and
mounting trouble in China’s real estate market dented the sentiments. Even on
the domestic front, IIP data came at 3 months low. After a tepid start, Nifty made a gradual
recovery during the day as buying emerged at lower levels in index
heavyweights. The index closed with minuscule lose of 26 points at 19478
levels. Except for IT, FMCG, and Media, all sectors ended in red.
Caution was
seen in the market today on account of fragile global factors and ahead of
India’s CPI data that would be released later today (Monday). We believe
inflation is likely to pick up in Jul-Aug’23 – entirely led by vegetables. We
expect the headline inflation at ~7.5% YoY in Jul’23, which is well above the
RBI’s tolerance band. Even WPI inflation came in a little higher than
expectation.
Persistent
selling by FIIs since July end too is keeping the Indian equities on edge. Thus
the market is witnessing consolidation at higher levels in the absence of any
positive trigger. We expect this trend to continue in the near term as a series
of macro data around the world and FOMC meeting minutes will be released during
the week which could keep markets subdued. Indian equities will remain closed
on Tuesday on the occasion of Independence Day and might stay lackluster on
Wednesday on account of the Parsi New Year.
Nifty futures
opened at 19449.80 points against the previous close of 19504.35 and opened at
a low of 19316.85 points. Nifty Future closed with an average movement of 189.40
points and a decline of around 26.00 points and 19478.35 points…!!
On the NSE,
the midcap 100 index will decline 0.17% and smallcap 100 index is closing decline
0.73%. Speaking of various sectoral indices, the NSE saw gains in only, Media,
IT and FMCG stocks, while all other sectoral indices closed lower.
At the start
of intra-day trading, October gold opened at Rs.58904, fell from a high of Rs.59019
points to a low of Rs.58825 with a rise of 12 points, a trend of around Rs.58918
and September Silver opened at Rs.69841, fell from a high of Rs.70240 points to
a low of Rs.69755, with a rise of 48 points, a trend of around Rs.70024.
Meanwhile, India’s
retail inflation measured by consumer price index (CPI), saw a huge rise to
7.44 per cent in July owing to hike in food prices, as food inflation witnessed
a massive jump of 11.51 per cent. The rise in retail and food inflation in
July is huge compared to the fact that retail inflation in June was 4.87 per
cent, while food inflation was 4.55 per cent. The July inflation has also
breached RBI’s tolerance limit of 6 per cent. The big spike in retail inflation
in July is mainly due to increase in prices of fruits and vegetables, cereals,
pulses, milk products and even clothing and footwear, according to figures
released by ministry of statistics and programme implementation on Monday. In
July 2022, retail inflation was 6.71 per cent and food inflation was 6.69 per
cent.
Technically, the important key resistances are placed in Nifty future are at 19505 levels, which could offer for the market on the higher side. Sustainability above this zone would signal opens the door for a directional up move with immediate resistances seen at 19606 – 19676 levels. Immediate support is placed at 19404 – 19343 levels.
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