1. Home
Feb 23, 2023
Examining volatility in Adani shares: Sebi

The Securities and Exchange Board of India (Sebi) issued a statement on Saturday to ease concerns about the ongoing volatility in the market, specifically the turbulence linked to Adani Group shares.“During the past week, unusual price movement in the stocks of a business conglomerate has been observed.

As part of its mandate, Sebi seeks to maintain orderly and efficient functioning of the market and has put in place a set of well-defined, publicly available surveillance measures (including the ASM framework) to address excessive volatility in specific stocks. This mechanism gets automatically triggered under certain conditions of price volatility in any stock,” the regulator said in a statement, without naming the conglomerate. Shares of Adani Group companies slid for the seventh straight session on Friday with the group’s combined market capitalisation seeing a drop of over $110 billion since January 24.

The regulator also reiterated its commitment to ensuring market integrity and to ensuring that markets continue to have the appropriate structural strength to function in an uninterrupted, transparent and efficient manner, as has been the case so far.”Sebi has consistently followed this approach on entity level issues and would continue to do so in future as well,” it said.

The Indian financial market, as represented by benchmark indices Sensex and Nifty, have demonstrated ongoing stability and continue to function in a transparent, fair and efficient manner, the regulator said.”On a longer term basis, Indian markets have been viewed positively by investors. A cross-country comparison of dollar-adjusted market returns with both peer and developed countries, during the past three years till date, places the Indian market as a positive outlier,” Sebi said.

More Details
Feb 21, 2023
Nifty to climb above 18000 or bears to grip Dalal Street again? 7 things to know before share market opening bell

Indian benchmark indices are likely to open on a negative note, hinted SGX Nifty. On the Singapore Exchange, Nifty futures were in the red at 17,963 level. In the previous session, Sensex closed marginally above 61,000, down 0.52% and the Nifty gave up 17,950. “Lack of major triggers in the domestic market is attracting global cues to dictate the market trend. The US market is facing an unfavorable combination of higher-than-expected inflation and a stronger job market. This suggests that interest rates have not yet peaked and will remain elevated for a long period,” said Vinod Nair, Head of Research, Geojit Financial Services.

Key things to know before share market opens

Wall Street Overnight

On Friday, Wall Street closed mixed as investor sentiments were weighed by sticky inflation and fears of continued rate hikes. The Dow Jones Industrial Average gained 129 points or 0.4%. However, the Nasdaq composite fell 0.6% and the S&P dropped 0.3% after paring a bigger loss from the morning.

Crude Oil

Oil prices were little changed in early Asian trade on Monday, after settling down $2 a barrel on Friday, as rising supplies in the United States and forecasts of more interest rate hikes cooled optimism over China’s demand recovery. Brent crude slid 9 cents, or 0.1%, to $82.91 a barrel. U.S. West Texas Intermediate crude for March, which expires on Tuesday, was at $76.40 a barrel, up 6 cents. The more active April contract fell 9 cents to $76.46.

FII/DII Data

Foreign institutional investors (FII) net sold shares worth Rs 624.61 crore, while domestic institutional investors (DII) sold equities worth Rs 85.29 crore on 17 February, according to the provisional data available on the NSE.

F&O Ban

The National Stock Exchange has Ambuja Cements and Indiabulls Housing Finance stocks on its F&O ban list for 20 February. According to the NSE, the stocks mentioned above are prohibited in the F&O sector because they have exceeded 95% of the market-wide position limit (MWPL). During the F&O ban period, no new positions are permitted for F&O contracts in that stock.

Technical View

“A small negative candle was formed on the daily chart with long upper and lower shadow. Technically, this pattern indicates minor reversal in the market from the highs. The minor degree positive chart pattern like higher tops and bottoms continued on the daily chart and present weakness could be in line with a new higher bottom formation. but, there is no confirmation of any higher bottom reversal yet at the lows.

“The short term trend of Nifty is choppy with weak bias. The present weakness has not damaged the near term uptrend status of the market so far and we expect chances of buying emerging from near the lower support of around 17,800 levels in the coming week. On the higher side, the area of 18,150 could act as a resistance,” said Nagaraj Shetti, Technical Research Analyst, HDFC Securities.

Levels to Watch

“According to the volume profile, the index may find support around 17,750-17,800. In terms of OI data, the call side had the highest OI at 18,000, followed by 18,100 strike prices, and the put side had the highest OI at 17,800 strike price. Bank Nifty, on the other hand, has resistance at 41,700-41,800 and support at 40,700-40,900,” said Ameya Ranadive, CMT, CFTe, Equity Research Analyst, Choice Broking.

More Details
Feb 20, 2023
Crude oil prices slide; Go long around Rs 6000/bbl with upside target of Rs 6500/bbl

By Bhavik Patel

In a surprising move, crude oil which started its rally from WTI $75 to $82 has once again returned back. The reopening of the Chinese economy was the main catalyst for the rally, however that fad seems to be fading away. The reversal of the zero-Covid policy of the authorities in Beijing was like a starting pistol for oil traders after a year of lockdowns and uncertainty. Now, there are also hopes that the United States could avoid a recession, even though the latest manufacturing data suggests otherwise.

One of the reasons for the recent correction would be recession fears. In fact after six months of 2022, crude oil started sliding on recession fears as central banks started aggressively hiking rates to combat inflation. We don’t believe prices will remain low for long as Chinese authorities have issued a massive batch of allowances for independent refiners to import crude oil. China’s reopening is expected to drive fuel demand growth after the initial exit Covid wave wanes at some point later this quarter. Crude oil imports into Asia hit an all-time high in January, rising by 11% from December, despite lower arrivals into China according to data from Refinitiv Oil Research.

Global oil demand is set to rise by 1.9 million bpd in 2023, to a record 101.7 million bpd, with nearly half the gain coming from China following the lifting of its Covid restrictions, the International Energy Agency (IEA) said in its Oil Market Report for January. OPEC+ is also dragging its feet as the entire OPEC-13 organization saw crude oil production in January drop to 29.12 million bpd due to lower output from Saudi Arabia and Libya, partly offset by slight gains among some other members.

Crude oil in MCX is in bearish trend as momentum oscillator RSI_14 is trading at 40. 6750 seems to be strong resistance as crude has reversed from that zone. The downside momentum is expected to continue till 6075-6000 where support is expected to emerge. 6000 is also the previous swing low. We would recommend to go long around that zone with expected price till 6500 and stoploss of 5900.

(Bhavik Patel is a commodity and currency analyst at Tradebull Securities. Views expressed are the author’s own. Please consult your financial advisor before investing.)

More Details
Feb 19, 2023
Nifty may remain volatile, use Call Ladder strategy for profits on F&O expiry; Bank Nifty support at 36000

By Rajesh Palviya

In Nifty current series a Long Unwinding has been witnessed with decrease in price of (-)2.18% and decrease in OI by (-)31% as of Wednesday, wherein there was unwinding of 37.79.06 lakh shares in OI, decreasing from 122.67 lakh to 84.88 lakh shares. NSE Nifty 50 current month rollover stands at 23% as of Wednesday, while Nifty Put Call Ratio, a sentiment indicator used by Traders to gauge the market sentiment and mood, is currently at 0.83 compared to 0.97 of last week, indicating flat-to-positive movement.

In weekly options there was Call writing seen at 17,200 strike followed by 17,300 & 17,500 while on the Put side noticeable activity of writing was witnessed in 17,000 ,16,800 & 16,700 strike prices. Options data suggest an immediate trading range between 17,000 and 17,300 levels.

Nifty Open Interest Concentration 

Nifty Option OI Change 

Bank Nifty Outlook

In current series there has been a Long Unwinding witnessed in Bank Nifty Fut with an decrease in price of (-)0.36% and decrease in OI by (-)42% as of Wednesday, wherein there was unwinding of 15.53 lakh shares in OI, decreasing from 37.06 lakh to 21.53 lakh shares. Bank Nifty Current series rollover stands at 20% as of Wednesday, while Bank Nifty Put Call Ratio, a sentiment indicator used by traders to gauge the market sentiment and mood, is currently at 0.63 compared to 0.80 of last week indicating flat-to-positive movement.

Bank Nifty Put options OI distribution shows that 36,000 has highest OI concentration followed by 35,500 & 35,800 which may act as support for current expiry and on the Call front 37,000 followed by 36,500 & 36,800 witnessed significant OI concentration and may act as resistance.

In weekly options Call writing seen at 36,500, 36,800 & 37,000 strike while on the put side it was seen at 36,000, 35,500 & 35,800 Options data indicated an immediate trading range between 37,000 and 36,000 levels.

Bank Nifty Open Interest Concentration

Bank Nifty Option OI Change

NSE Nifty 50 trading strategy for F&O expiry day

The strategy which we are suggesting for this monthly expiry dated 28th April is a Moderately Bullish strategy called as CALL LADDER, which involves buying of one lot of Nifty 17,150 Call @ 180 & selling of one lot each of 17,300 Call @ 106 & one lot of 17,450 Call @ 57. The cost of the strategy involves outflow of Rs 850 which is the maximum loss if Nifty trades and remains below 17,160 levels on expiry day.The maximum profit of Rs 6,650 will be attained at 17,300 levels, while strategy will start making loss above 17,580, hence it’s advisable to exit the strategy in total to avoid unlimited losses above 17,580. Break Even points of the strategy are 17,583 on upside and 17,167 on the lower side.

(Rajesh Palviya, VP – Research (Head Technical & Derivatives), Axis Securities. Views expressed are the author’s own.)

More Details
Feb 17, 2023
Buy these two stocks for gains while Nifty, Bank Nifty structures remain bearish

By Rohan Patil

Last week was a very volatile week for the Indian bourses as well as for the entire global market. Every alternate day Nifty changes its candle colour and the major gap up and gap down was the main pain for the benchmark index. Till the last day of the trading week, the index was showing a negative return for the week but a surprising gap-up opening on Friday’s session led to a strong buying and the Nifty closed the week with a three per cent gain.

The immediate support for the Nifty is placed near 16000 and below that 15800 will act as major support for the Nifty. The immediate resistance for the Nifty is placed at 16450 levels where 21-day exponential moving average is settled.

Bank Nifty structure still bearish

From the last couple of weeks, prices are finding support near their 100-week exponential moving average which is placed at 33618 levels. The Momentum oscillator RSI (14) has shown a positive divergence at oversold levels on the weekly scale. In this case, indicator made a new low but prices have defended their previous low.

The Bank Nifty on the daily chart has made a flag like formation whose upper band is formed at 34800 levels and the lower band of the pattern is from 33400 levels. The overall structure for the Bank Nifty still remains bearish as prices are well sustained below its (21, 50, &100) – day exponential moving averages.

We feel that the Currently Banking index has just shown a positive divergence and prices have just shown some recovery so an oversold rally at this point cannot be ruled out.

The immediate support for the Bank Nifty is placed near 33300 and below that 32500 will act as major support for the Bank Nifty. The immediate resistance for the Bank Nifty is placed at 34800 levels where 21-day exponential moving average is settled.

Tata Elxsi: BUYTarget: Rs 9000 | Stop Loss: Rs 8000Return 07%

TATA ELXSI on the daily chart has given a sharp V shape reversal rally and has formed an intermediate bottom at around 6800 levels. The prices have also given a downward sloping trend line breakout on 18th May above 8200 levels.

On the weekly chart prices have formed a bullish engulfing candle stick pattern and prices are trading above the high of the pattern which is positive for the prices. Prices are trading well above its important averages and Momentum oscillator RSI has also witnessed a trend line breakout above 55 levels on the daily interval.

ITC: BUYTarget: Rs 300 | Stop Loss: Rs 266Return 07.20%

ITC is giving a consolidation breakout which has been making since last six weeks and sustaining at multi – -year high indicating positive undertone of the market. On the daily charts, the stock is forming big bullish candle with huge volumes of confirmations.

On the indicator front, the RSI plotted on all the time frame is sustaining above 60 levels which shows strong positive momentum. The earlier stock has given breakout 6 weeks prior and prices consolidated above its trend line support without disturbing its bullish technical factor.

(Rohan Patil is a Technical Analyst at Bonanza Portfolio. The views expressed are the author’s own. Please consult your financial advisor before investing)

More Details
Feb 15, 2023
Brokers stare at losses as Adani stocks remain shaky

Brokers who have provided funding to clients against shares of Adani group stocks are staring at losses worth hundreds of crores.

This is because a number of the group’s shares — Adani Green Energy, Adani Transmission, Adani Wilmar, Adani Power and Adani Total Gas — have been hitting the lower circuit almost every day since January 25. This means trading has stopped in these shares for the most part and brokers are unable to offload shares in the market as there are no buyers.

Flagship Adani Enterprises recovered to end 1.25% higher to close at Rs 1,584 after slipping over 25% intraday. The shares had tanked 26.5% on Thursday and 27% on February 1. ACC, Ambuja Cements and Adani Ports & SEZ also ended in the green.

Also read: Gautam Adani no longer among world’s top 20 richest people as Adani Group sheds $108 billion in market value

Other stocks, however, continued to hit their lower limits. Adani Transmission and Adani Green Energy tanked by 10%, while Adani Total Gas, Adani Power and Adani Wilmar were down 5% each. Experts suggest that if the stocks continue to hit lower circuits, brokers will be staring at naked positions, with prices falling below the amount lent to clients, resulting in losses for brokers.

Margin against shares is offered by brokers to traders wanting to take leveraged bets.The broker takes the stocks as collateral and lends funds to trade on a short-term basis.

“Some of the Adani Group stocks are hitting the lower circuit every day. Suppose if someone was holding Adani Green shares and there’s a margin call. In normal circumstances, the broker can sell the shares if the client is unable to bring additional funds. But in this case, the broker won’t be in a position to liquidate the shares because there are no buyers,” said a senior industry official.

Let’s say the broker had set a 50% funding limit on a share collateral of Rs 10 crore of Adani shares. Once the share value of these falls below Rs 5 crore, it will trigger margin calls. The broker will call for additional funds or will resort to selling the shares available with it to meet the shortfall. If the broker is unable to sell, it will have to meet the shortfall on its own.

Brokers could also face issues in their margin trading facility (MTF) books. Those offering MTF have already increased the margin requirements on Adani Group stocks in the past few days to as high as 70-80%, said people in the know. One leading broker has put Adani Enterprises in its no funding list.

Also read: Scaling up our ethanol blending programme

“We were not providing MTF facility against most of the Adani Group stocks, except Adani Ports and Adani Enterprises, and that too with a very high margin. That may not be the case with the rest of the industry,” said Ashish Rathi, whole time director, HDFC Securities.

“If you look at Adani Total Gas, the stock has been falling without volume. It’s difficult to exit. Even if you have a margin with a 20-25% haircut you can’t liquidate that stock,” he said.

More Details
Feb 14, 2023
Coronavirus in India: How is Delhi Metro sanitising trains, stations? See pics

1/6

Coronavirus outbreak in India: With the increasing number of Coronavirus cases in India, Delhi Metro trains and stations are being sanitised and cleaned more frequently. In the wake of this recent outbreak, the Delhi Metro Rail Corporation (DMRC) has taken some extra measures for sanitising and cleaning the Delhi Metro stations and trains. In a press conference, Delhi Chief Minister Arvind Kejriwal and Health Minister Satyender Jain announced that as per the advisory for preventing the spread of Coronavirus, all Delhi Metro trains, stations as well as the Delhi Transport Corporation (DTC) must be disinfected regularly. These steps have been taken for the safety of commuters and to maintain hygienic public spaces in the transport systems. Check out these pictures which show how DMRC has taken some effective measures, by regularly sanitising Delhi Metro stations and trains:

2/6

Delhi Metro trains are being disinfected and sanitised by using a different chemical. The frequency of the cleaning has been increased. The trains are being sanitised during the operational hours, throughout the day and also when the trains are taken to the depot, post the operational hours.

3/6

The Delhi Metro employees, staff and housekeeping management have been sensitized and made aware of the do’s and dont’s for preventing the spread of the infection.

4/6

DMRC has issued orders to regularly clean the Delhi Metro train doors, PEAs, hand railings and other such areas where the hands come in direct contact inside the coaches. A special emphasis has been laid on sanitising the escalators, lifts, staircases, hand railings at the Delhi Metro stations.

5/6

To prevent the spread of the virus, the do’s and dont’s have been displayed on the digital screens at major Delhi Metro stations such as Central Secretariat, Rajiv Chowk, Kashmere Gate, New Delhi, in both Hindi and English.

6/6

Special informative messages have been displayed at Delhi Metro stations for commuters, for adopting basic preventive measures such as wearing face masks, sanitizing hands, maintaining distance from a person showing symptoms. The do’s and dont’s have also been installed in the advertising panels inside the Delhi Metro trains. These measures undertaken by DMRC have been in accordance with the guidelines from the World Health Organization (WHO).

More Details
Feb 12, 2023
Nifty to aim for 17500 if it holds 16800 support; Bank Nifty may head to 37300 soon; SBI, TCS stocks top bets

By Dharmesh Shah

NSE Nifty 50 index started the week with a negative gap (17172-17009) and traded volatile guided by global cues. However supportive efforts emerged from the lower band of consolidation (16800) on a couple of occasions which helped index to recoup intra-week losses. As a result, weekly price action formed an inside bar as Nifty oscillated within last week’s trading range of 17415-16825, indicating choppy consolidation amid stock specific action.

Immediate resistance is placed at 17500 is a confluence of:

A) Bearish gap recorded on April 18, 2022 placed in the range of (17475-17238)

B) 50% retracement of April decline (18114-16825)

Structurally, strong base at 16800 has been made as over past 17 sessions retraced only 50% of 19 session rally despite elevated global volatility which we do not expect to be breached in coming weeks as it is confluence of:

a) 50% retracement of the entire March 2022

b) 200 days EMA placed at 16860

Sectorally, we are positive on BFSI, Auto, Metals, PSU. IT offers favorable risk reward amid oversold conditions. Our preferred large cap stocks are State Bank of India (SBI), Bandhan Bank, Asian Paints, Tata Motors, Tata Consultancy Services (TCS), JSW Steel, Divi’s Labs while in midcaps we like Amber Enterprises, Apollo Tyres, Concor, Indian Hotels, Mahindra CIE, Gokaldas Exports, Persistent Systems, Phoenix Mills, NMDC.

The broader market indices are consolidating in the vicinity of 200 days EMA. We believe, base formation from hereon would set the stage for next leg of up move amid ongoing Q4FY22 earning season.

Bank Nifty Outlook

The Bank Nifty traded with high volatility as it oscillated in a 1200 points range to close on a flat note amid volatile global cues ahead of the US FOMC meeting schedule next week. The weekly price action formed a high wave candle with shadows in either direction signaling pause after last three week’s corrective decline In the coming truncated week, we expect the index to hold above the crucial support area of 35500-35000 and gradually head towards 37300 levels in the coming weeks. The index has already taken four weeks to retrace just 50% of its preceding four weeks up move (32156-38765). A shallow retracement signals a positive price structure and a higher base formation.

On the higher side 37300 is likely to act as a major hurdle being the confluence of the bearish gap area of 18th April & the 50% retracement of recent decline (38765-35511). Structurally, the current corrective decline is shaping out as a retracement of a strong 20% rally from March 2022 lows (32156) which has helped the index to work off the overbought conditions in the weekly time frame.

We expect the index to hold above the strong support area of 35500-35000 levels as it is confluence of

a) 61.8% retracement of the entire March 2022 up move (32155-38765) placed at 34800 levels

b) The rising 52 weeks EMA is also placed around 35500 levels

c) The recent swing low of second half of March 2022 is also placed around 35000 levels/.

Among the oscillators the weekly stochastic has cooled off from the overbought territory and is currently placed at a neutral reading of 42 signaling a pullback likely in the coming weeks

Dharmesh Shah is the Head – Technical at ICICI Direct. Please consult your financial advisor before investing.)

ICICI Securities Limited is a SEBI registered Research Analyst having registration no. INH000000990. It is confirmed that the Research Analyst or his relatives or I-Sec do not have actual/beneficial ownership of 1% or more securities of the subject company, at the end of 21/01/2022 or have no other financial interest and do not have any material conflict of interest. I-Sec or its associates might have received any compensation towards merchant banking/ broking services from the subject companies mentioned as clients in preceding 12 months.

More Details
Feb 10, 2023
InsuranceDekho raises $150 mn in Series A funding

Insurtech player InsuranceDekho has raised $150 million in Series A funding, consisting of a mix of equity and debt.

“The equity round was led by Goldman Sachs Asset Management and TVS Capital Funds with participation from Investcorp, Avataar Ventures and LeapFrog Investments,” the company said in a release. This is the first time the firm has raised external funding.

Also read: Sensex falls 300 pts, Nifty below 17800 in early trade on Mon, Feb 13; Adani Green shares dip, Paytm stock gains

The company aims to achieve annualised premium run-rate of `3,500 crore by March 2023. “We need to go beyond the urban regions when it comes to insurance penetration in the country. To realise our goal of democratising insurance for the general public, we are expanding our reach and will continue to build on our tech-based solutions and empowered advisors…,” said InsuranceDekho CEO and co-founder Ankit Agrawal.

Ish Babbar, CTO and co-founder, said insurance distribution in India needs innovative solutions. “The fundraise will enable us to deploy scalable insurtech solutions in the areas of data analytics, artificial intelligence, last mile servicing and claims management while keeping customer experience at the core of everything,” Babbar said.

Also read: Drone maker ideaForge files for IPO: A side-by-side look vs DroneAcharya’s bumper IPO; issue size, more

The company said it gets 82% of its premium from Tier 2 and beyond regions. It is present in more than 1,300 towns covering 98% of pin codes.

Rajat Sood, managing director at Goldman Sachs Asset Management, said, “Technological innovation is transforming the Indian insurance industry by making coverage more accessible and affordable. InsuranceDekho has demonstrated a proven ability to bring new-to-insurance channel partners to their platform, while empowering them through technology-based solutions and working closely with insurers. We look forward to leveraging our global domain expertise and supporting the management team in its expansion to provide broader coverage and more solutions nationwide.”

More Details
Feb 10, 2023
Russia cuts crude production, prices correct on USD rally; short Crude March contract with Rs 6620/bbl stoploss

By Bhavik Patel

MCX Crude is trading in the range of 6,350-6,600. This week we had negative, as well as, positive news which kept bulls and bears both active but neither gained any upper hold. Middle of the week, US inventory came larger than expected which prompted sellers in action but prices recovered soon as OPEC and the International Energy Agency raised their demand forecasts for the year, shaking off EIA’s latest weekly inventory report.

Last week, Russia announced a 500,000 bpd voluntary production cut due to growing pressure from price caps and embargoes and Saudi Arabia raised its official selling price for the first time in the last six months which both is positive for crude oil. We believe the correction in crude would continue on the back of a rally in USD as yesterday also Fed members started to increase rates due to persistent high inflation. At the moment those comments from Fed are overshadowing increased demand prediction as well as supply cut which is why crude prices are correcting.

Crude in the MCX March contract had made double top around 6780 and the current rally failed to cross over that level. In fact, the rally only went till 6700 before fizzling out and so 6780 continues to be strong resistance. We believe the correction will continue till 6350 and 6200. 6050 seems to be strong support so any correction around that zone would be an ideal opportunity to go long. Right now one can go short in Crude March contract with stoploss of 6620 and expected downside target of 6300.

(Bhavik Patel, Currency and Commodity Analyst, Tradebull Securities. Views are author’s own. Please consult your financial advisor before investing.)

More Details