NEW DELHI: As Nifty ended above the 11,500 level on Tuesday it formed a bullish candle on the daily chart.
Vinod Nair of Geojit Financial Services said the markets are almost at the upper end of the trading range and a push above 11,600 could bring in more trading optimism.
Nagaraj Shetti of HDFC Securities said the short-term trend of Nifty is range bound with positive bias.
"Renewed buying enthusiasm could only occur above 11,600 and that is likely to pull the market towards 11,800 levels in a quick period of time. Important lower supports to be watched at 11,380 and a breach below this support could trigger more weakness in the near-term," he said.
Rajesh Palviya of Axis Securities said that the short term support is placed around 11,430-11,400 levels.
"Both daily strength indicator RSI as well as momentum indicator Stochastic are in a bullish mode which supports upside momentum," he said.
That said here’s a look at what some of the key indicators are suggesting for Wednesday's action: Tech stocks lead US shares rally Tech stocks pushed Wall Street's main indexes higher on Tuesday as positive US factory data fueled optimism around an economic rebound, while investors looked for continued support from the Federal Reserve as its two-day meeting got underway. The Dow Jones Industrial Average was up 125.47 points, or 0.45%, at 28,118.80, the S&P 500 was up 23.72 points, or 0.70%, at 3,407.26. The Nasdaq Composite was up 104.07 points, or 0.94%, at 11,160.72.
European shares flat as focus shifts to central bank meetings European stocks struggled for direction on Tuesday, with banking shares declining ahead of the U.S. and UK central bank meetings this week, while Sweden's H&M surged after reporting a better-than-expected profit. UK's FTSE 100 rose 0.1%, barely reacting to data that showed unemployment rate rose 4.1% in the three months to July - the first time since the coronavirus lockdown began in March - although it was in line with economists' expectations. The pan-European STOXX 600 was flat.
Tech View: Nifty50 forms bullish candle Nifty50 reclaimed the 11,500 level on Tuesday and formed a bullish candle on the daily chart. Analysts said levels near the recent swing high of 11,585 may continue to create hurdles for the index in the immediate term. The 20-day moving average, whose value stands at 11,443, would keep offering support to the index, as was the case on Tuesday, analysts said. Gaurav Ratnaparkhi, Senior Technical Analyst at Sharekhan, said the index did not see follow-through selling on Tuesday, despite forming a couple of bearish candlestick and bar patterns on Monday.
F&O: VIX needs to cool down for next leg of rally India VIX fell 2.80 per cent from 21.19 to 20.59 level. VIX needs to cool down below the 20-18 zone to get the bulls have a grip for the next leg of rally. Options data suggests a wider trading range in between 11,300 and 11,700 levels.
Stocks showing bullish bias Momentum indicator Moving Average Convergence Divergence (MACD) on Tuesday showed bullish trade setup on the counters of Ashok Leyland, Alok Industries, Firstsource Solution, Hexaware Technologies, UPL, Lupin, Siemens, Engineers India, Welspun India, Caplin Point Lab, MindTree, Radico Khaitan, Meghmani Organics, Just Dial, KEC International, Zensar Technologies, Info Edge (India), Rites, Godrej Agrovet, MCX, Action Construction, Minda Industries, Borosil Renewables, Refex Industries, Kothari Sugar, Ramkrishna Forgings, Eris Lifesciences, Zydus Wellness, Narayana Hrudayalaya, TCI Express, Dynemic Products, Syncom Healthcare, GE Power India, JK Cement, Cigniti Technologies, Seya Industries, Lakshmi Finance, Kirloskar Industries, Poddar Housing and Salona Cotspin among others.
Stocks signalling weakness ahead The MACD showed bearish signs on the counters of Titan Company, Fermenta Biotech, Repco Home Finance, Asian Oilfield, Asian Paints, Compuage Infocom, Pasupati Acrylon, Kushal, Commercial Syn Bags, Xtglobal Infotech, Filatex India, Avantel, Mystic Electronics, Goenka Business, Indo Borax, Unick Fix-A-Form, Hawa Engineers, Softsol India, Benares Hotels, Dutron Polymers, Fomento Resorts, Shri Dinesh Mill and Technofab Engineering among others.
Tuesday’s most active stocks RIL (Rs 2898.69 crore), TCS (Rs 1831.62 crore), Bharti Airtel (Rs 1480.21 crore), Bajaj Finance (Rs 1360.93 crore), Infosys (Rs 1139.94 crore), Dr. Reddys Laborat (Rs 1125.43 crore), HCL Tech (Rs 1115.40 crore), Cipla (Rs 1084.38 crore), SBI (Rs 1027.74 crore) and ICICI Bank (Rs 921.81 crore) were among the most active stocks on Dalal Street on Tuesday in value terms.
Tuesday’s most active stocks in volume terms Vodafone Idea (shares traded: 74.19 crore), YES Bank (shares traded: 8.34 crore), Ashok Leyland (shares traded: 7.78 crore), SBI (shares traded: 5.16 crore), Tata Motors (shares traded: 4.29 crore), SAIL (shares traded: 4.06 crore), IDFC First Bank (shares traded: 3.89 crore), Bharti Airtel (shares traded: 3.08 crore), ITC (shares traded: 3.08 crore) and BHEL (shares traded: 3.02 crore) were among the most traded stocks in the session.
Stocks seeing buying interest Radico Khaitan, J B Chem, Suven Pharma, Hexaware and MphasiS witnessed strong buying interest from market participants as they scaled their fresh 52-week highs on Tuesday signalling bullish sentiment.
Stocks seeing selling pressure Ramsarup Industries and UTI Mutual Fund - UTI Bank Exchange Traded Fund witnessed strong selling pressure in Tuesday’s session and hit their 52-week lows, signalling bearish sentiment on these counters.
Sentiment meter favours bulls Overall, market breadth remained in favour of bulls. As many as 305 stocks on the BSE 500 index settled the day in green, while 191 settled the day in red.
Podcast: What are Nifty chart structures suggesting now? >>> After a one-day hiatus, the benchmark indices went back to winning ways on Tuesday encouraged by easing inflation and positive cues from global markets. Index heavyweights HDFC Bank, ICICI Bank and RIL all ended in the green, while ITC, Maruti Suzuki and Asian Paints slashed some of the gains. Overall, BSE Sensex closed nearly 288 points higher at 39,044 while Nifty rose 82 points to 11,522. We caught up with Ajit Mishra of Religare Broking to try and understand the market undercurrent.
Ahead of Market: 12 things that will decide stock action on Wednesday
3 min read.Updated: 15 Sep 2020, 09:39 PM ISTLivemint
As India has no safety net for those who can’t subsist on MGNREGA wages, the government should let the laid-off have a year’s worth of their income tax back as a zero-interest loan
On a day the government sought Parliament’s nod for additional expenditure of ₹40,000 crore on India’s only fall-back option for the jobless, the Mahatma Gandhi National Rural Employment Guarantee scheme that pays labour-level wages, our Union Labour Minister Santosh Kumar Gangwar informed lawmakers that people withdrew nearly the same amount from their provident funds between 25 March and 31 August. Distress withdrawals made up a large portion of that sum, as our anti-covid lockdown saw commercial activity grind to a halt, cries for compensation go unheard, and millions lose their salaries. According to data of the Centre for Monitoring Indian Economy, an estimated 21 million salaried employees lost their jobs during the five months till August. By volume, the brunt of it has been borne by those in low-income brackets, just as migrant workers were the worst affected by the country’s shutdown. Yet, Indians who were drawing bigger packets have been pink-slipped and thrown into financial turmoil too. The Mint-Bain India CEO Survey found that nearly a third of our corporate chief executives had seen either layoffs or a combination of pink slips and pay cuts within their organizations. Severance terms are rarely generous, jobs are expected to be scarce for a long while, and India has no safety net for the better off. This being the case, the country would do well to consider a one-off relief package for taxpayers who have been laid off.
At a minimum, the Centre should return the sums paid as income tax in 2019-20 by those who have suddenly been deprived of their income. This money could be granted as a zero-interest loan to be repaid in equal instalments over a stretch of five years after they regain employment. With our tax authorities in possession of the data needed for it, such a scheme should be easy to execute. The basic rationale is to offer relief that’s proportional to lost earnings. In a country of such wide differences in what people earn, it takes little intuition to infer that estimations of subsistence wages differ widely from one household to another. While the government is under no obligation whatsoever to give any tax money back, it must not lose sight of the fact that most of our recent livelihood losses could squarely be attributed to its imposition of a lockdown, regardless of how necessary it was. Everyone deserves to be compensated in some way.
It is another matter that the Centre is acutely short of resources at the moment. But tax credits for laid-off taxpayers might not strain the exchequer all that much. Those eligible for such a programme may not be very numerous. Of the 10.4 million odd salaried workers who withdrew money from their retirement pot after the pandemic struck, only about a fifth were reported to be earning ₹15,000 or more per month. The numbers narrow sharply as one ascends India’s income pyramid. By government data, less than 15 million citizens pay any direct tax at all. Of last fiscal year’s mop-up of about ₹5.5 trillion by way of personal income taxes, only one slice of the revenue intake was from salaried individuals, and of this, only a fraction would probably have been retrenched. Also, it would not be a hand-out. All beneficiaries would have bigger tax bills to settle once they’re rehired. It’s just that it could be a painfully long time before they are.
In a complex and unexpected move, Bubba Wallace has likely found a new home next season in the NASCAR Cup Series.
Gaunt Brothers Racing has emerged as the front-runner to land Wallace for the 2021 season, Motorsport.com has learned. Wallace, 26, announced last week he would be leaving Richard Petty Motorsports at the end of the year.
Gaunt Brothers is in its first season fielding a fulltime Cup team, currently with driver Daniel Suarez in the No. 96 Toyota. It has received substantial backing from Toyota this year but minimal technical support on the chassis side.
Suarez out of the No. 96
On Tuesday, however, Suarez and Gaunt announced the two sides had agreed to part ways at the conclusion of the 2020 season. Suarez’s future remains unclear but Gaunt Brothers appears set to have an entirely new look in 2021.
Once complete, a reorganization of Gaunt Brothers would include the acquisition of a charter, influx of new investors, new sponsors and expanded manufacturing support from Toyota, according to multiple sources who declined to speak on the record because the deal is not complete.
However, the additional capital investment could put the organization on a level similar to that of the former Furniture Row Racing, sources said.
FRR won the Cup series championship in 2017 with driver Martin Truex Jr., while receiving chassis and engines as part of a technical alliance with Joe Gibbs Racing. The team folded after the 2018 season.
Motorsport.com submitted several questions to Gaunt officials covering topics including its interest in adding Wallace as a driver and the addition of new investors to the organization in 2021.
A team spokesperson responded with following, “Gaunt Brothers Racing does not discuss the terms of its agreements, whether it’s in regard to personnel or partners.”
However, in announcing Suarez’s departure on Tuesday, owner Marty Gaunt indicated his organization remained committed to success in the Cup Series.
“We’re laying important groundwork for improved goals next year that, ultimately, sets us up for success with the NextGen car in 2022,” he said in a statement.
“We’re taking a methodical, long-term approach to our future and the next driver of our No. 96 Toyota will be an integral part of that development.”
Expanded Toyota support?
David Wilson, president of Toyota Racing Development, said Toyota has the capacity to expand their support in 2021 given the unexpected departure of Leavine Family Racing and would entertain the addition of a new team or teams in 2021 “provided the right circumstances.”
He said the situation would be difficult, however, given the one-year remaining of the Cup car using its current Gen-6 model car before transitioning to the Next Gen car in 2022. Teams were originally scheduled to move to the Next Gen car in 2021 but the COVID-19 pandemic prompted a one-year delay.
“We’ve talked to a number of team owners this summer about opportunities, but we have nothing to talk about or announce right now,” Wilson said.
Hamlin's involvement
Sources told Motorsport.com the additional investor support at Gaunt Brothers could include the widely rumored involvement in team ownership by Cup series star Denny Hamlin, another Toyota driver who competes at JGR.
Hamlin, a three-time Daytona 500 winner and currently enjoying one of the best seasons of his career, said last month he was working on several open-ended projects but had nothing to imminently announce when asked about the possibility of buying into a current Cup team.
“I’m always looking at avenues that would allow me to stay in the sport beyond driving. Certainly, it’s a sport that I believe in,” he said. “Certainly, the financial model hopefully will get better in the next few years for the team owners, regardless if I’m in it or not.”
At the time Hamlin was questioned about a possible ownership role, multiple reports had connected his potential investment to a team that would include Wallace as the driver.
In a video conference with reporters earlier this month, NASCAR President Steve Phelps said it was possible for a current driver of a four-car Cup team to hold ownership in another team, but that NASCAR would have to ensure fair competition. At that time, Phelps said Hamlin had not made an official request to NASCAR for team ownership.
Wallace, the only full-time African-American driver in the Cup Series, has been among the most vocal leading NASCAR’s response to racial injustice protests across the country this summer.
He has recently signed several prominent sponsorship deals including Beats by Dre, Columbia Sportswear, DoorDash and Cash App.
Wallace has had his most competitive season in Cup since his fulltime debut in 2018. He has one top-five and five top-10 finishes and is currently ranked 23rd in the series standings. He also owns six career wins in the NASCAR Truck Series and six in K&N Pro Series East (now ARCA East).