India VIX spiked higher in the last week but again it fell down to 15.45% and gradual dips in VIX suggests a short term stability in the market.
Indian market consolidated for the second consecutive session in a row on Friday and closed flat. However, on weekly basis, both Sensex and Nifty rose 0.6 percent, and 0.2 percent respectively.
The big outperformer was the broader market as both Nifty Midcap and Small-cap indices recorded gains of over 2 percent each for the week ended February 22.
In terms of sectors, Nifty Metal rose 6 percent, followed by nearly 5 percent rally in the Realty sector, and Nifty Media rose 3.7 percent in the week.
After hitting a bottom at 10585, experts feel that the index should retest 10900 in the coming week, but could face selling pressure at higher levels around 11,000 in the short term.
Foreign investors on Friday pumped in a huge net of Rs 6,311 crore into the Indian capital markets, the highest inflow in a single day this month so far, exchange data showed.
The rupee on Friday gained 10 paise to close at 71.14 against the US dollar on heavy foreign capital inflows after growing expectations that the Federal Reserve would keep the interest rate on hold this year.
On the institutional front, FPI were net buyers in Indian markets for Rs 6311 crore and DIIs were net buyers to the tune of Rs 838 crore, provisional data showed.
Big News:
Oil prices touched their highest since mid-November on February 22 and posted weekly gains for the second week in a row, boosted by hopes that US-China trade talks would soon produce a deal, although new record US oil supply limited gains.
Brent crude futures briefly reached $67.73 a barrel, their 2019 high. The global benchmark fell 5 cents to settle at $67.12 a barrel. Brent gained 1.2 percent on the week.
Oil futures indicate Brent of US$66/bbl until Dec’19. OMCs are possibly building a buffer ahead of elections as petrol/diesel marketing margins remain near record levels, said a CLSA report.
India imports almost 86% of its annual crude oil requirement. Since the payments are made in USD, India’s deficit will depend on crude price as well as on the USD to INR conversion.
The USD and INR conversion in itself is dependent on oil prices, and hence the larger the outflow of USD, the sharper will be the rupee depreciation.
Technical View:
Nifty formed a Hammer-like pattern on weekly charts suggests more upside in the coming week
But, a confirmation is still required before we can conclude that the bulls can now take control of D-Street
The Nifty50 index witnessed two-consecutive days on which it had a touch-and-go-moment with 10800.
A close above 10808 which was the intraday high formed on Thursday, 21 February who confirm the theory
Three levels: 10758, 10801, 10900
Max Call OI: 11000, 10900
Max Put OI: 10700, 10400
India VIX spiked higher in the last week but again it fell down to 15.45% and gradual dips in VIX suggests a short term stability in the market.
Stocks in news:
Motilal Oswal & IIFL Holdings: The Securities and Exchange Board of India (SEBI) has declared the commodity broking arms of Motilal Oswal and India Infoline (IIFL) as 'not fit and proper', as part of the action in the NSEL case.
Jet Airways: Shareholders of distressed airline Jet Airways have approved the resolution plan to rescue the airline, with over 97 percent approval for each of the items.
Axis Trustee on February 22 said more shares of Reliance Communications have been pledged with it, taking the total shares with it to 9.18 percent.
Technical Recommendations:
We spoke to Angel Broking and here’s what they have to recommend:
Oberoi Realty: Buy| LTP: Rs 503.10| Target: Rs 570| Stop Loss: Rs 464| Upside 13%
Sun TV Ltd: Buy| LTP: Rs 585.90| Target: Rs 672| Stop Loss: Rs 559| Upside 15%
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