Dear Trader…
Indian equity benchmarks were positive for second consecutive day and ended Tuesday’s session with gains of around two percent, led by a strong rebound across all sectors amid positive cues from the global markets. Domestic indices opened gap up and continued to gain strength throughout the day, as traders took support with the southwest monsoon Monday, cumulative rainfall deficiency so far has been reduced to 5% from 25% reported on June 16. The India Meteorological Department (IMD) has predicted an intense spell of rainfall along the west coast in the next five days. Some support also came as retirement fund body EPFO has added 17.08 lakh net new subscribers in April 2022, nearly 34 per cent more than 12.76 lakh enrolled in the same month a year ago.
On the global front, European markets were trading higher recovering slightly from last week's 17-month lows as the selloff paused, but major central banks' rate hike plans and global recession risks kept investors cautious. Asian markets ended mostly higher on Tuesday following the positive cues from European markets overnight, with traders picking up stocks at a bargain after the recent sell-off in global markets, the worst since 2020. However, traders remain worried about a recession amid bets of bigger interest-rate hikes from major central banks.
Nifty futures opened at 15440.00 points against the previous close of 15347.65 and opened at a low of 15434.95 points. Nifty Future closed with an average movement of 281.80 points and a rise of around 285.75 points and 15633.40 points...!!
On the NSE, the midcap 100 index will rise 3.56% and smallcap 100 index is closing rise 3.42%. Speaking of various sectoral indices, Media, PSU Bank, Metal, Realty and IT, stocks saw heavy gains on the NSE, while all other sectoral indices also closed higher.
At the start of intra-day trading, August gold opened at Rs.50827, fell from a high of Rs.50860 points to a low of Rs.50650 with a rise of 85 points, a trend of around Rs.50820 and July Silver opened at Rs.60962, fell from a high of Rs.61045 points to a low of Rs.60661, with a decline of 12 points, a trend of around Rs.60732.
Meanwhile, the finance ministry in its monthly economic review report has said that India is facing near-term challenges in managing its fiscal deficit, sustaining economic growth, reining in inflation and containing the current account deficit but the country is relatively better placed to weather these headwinds compared to other nations. It added near-term challenges need to be managed carefully without sacrificing the hard-earned macroeconomic stability. It said ‘Many countries around the world, especially developed countries, face similar challenges. India is relatively better placed to weather these challenges because of its financial sector stability and its vaccination success in enabling the economy to open up’.
As per the report, India's medium-term growth prospects remain bright as pent-up capacity expansion in the private sector is expected to drive capital formation and employment generation in the rest of this decade. Observing that the capex budget for 2022-23 is expected to underpin growth, the report said an upside risk to the budgeted level of gross fiscal deficit has emerged following cuts in excise duties on diesel and petrol. It said an increase in the fiscal deficit may cause the current account deficit to widen, compounding the effect of costlier imports, and weaken the value of the rupee thereby, further aggravating external imbalances, creating the risk (admittedly low at this time) of a cycle of wider deficits and a weaker currency.
Technically, the important key resistances are placed in Nifty future are at 15676 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 15707 – 15777 levels. Immediate support is placed at 15474 – 15303 levels.
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