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The Indian equity market on Monday is expected to react to the outcomes of state assembly elections in Maharashtra and Jharkhand, alongside global triggers such as developments in the Russia-Ukraine war. The BJP-led Mahayuti alliance swept Maharashtra, registering much more seats than predicted by exit polls.
This result is likely to provide political stability, boosting investor sentiment—particularly in infrastructure, urban development, and manufacturing sectors aligned with BJP policies. Stability in Maharashtra could trigger a stock market rally, enhancing investor confidence due to the continuity of pro-business policies, especially after uncertainty from previous coalition shifts.
Friday’s gains helped the market turn positive for the week, snapping a two-week losing streak and regaining half of the losses from the prior week. Notably, 34 of the 50 Nifty stocks recorded gains during the week.
The Nifty posted its best single-day gain in over five months on November 22, rising nearly 2.4%. Buying at lower levels in blue-chip stocks fueled the rally, with several index heavyweights, including Reliance, posting significant gains. Adani Group stocks also saw a recovery, climbing up to 14% from recent lows. These healthy gains helped BSE-listed companies add ₹7 lakh crore in market capitalisation.
On the corporate results front, the Q2FY25 earnings scorecard was weak overall, but excluding commodities, it reflected in-line earnings growth. Siddhartha Khemka of Motilal Oswal expects a recovery in corporate earnings moving forward. However, in the near term, Khemka anticipates continued market volatility driven by state election outcomes, FII activity, and global geopolitical concerns.
Foreign institutions continued to remain net sellers in the cash market on Friday, while domestic institutions were net buyers.
The Nifty50 index ended the session with an impressive 2.39% gain at 23,907.25, marking a strong relief rally. This momentum carried the index to a weekly gain of 1.59%.
A gap-up start for Nifty 50 and Nifty Bank cannot be ruled out.
"In the daily timeframe, the Nifty formed a bullish engulfing pattern. Nifty has reclaimed the 10 DMA and 200 DMA, though still trailing the 20 DMA. On the hourly chart, the formation of an inverse head-and-shoulders pattern hints at a potential upside, projected to the 24,150–24,200 range. The support has now shifted higher to 23,600 levels. The short-term strategy has altered from ‘sell on the rise’ to ‘buy the dip’, signalling a bullish undertone," said Om Mehra, Technical Analyst, SAMCO Securities.
As long as the market is trading above 200 day SMA or 23600/77500 the pullback formation is likely to continue, believes Amol Athawale of Kotak Securities. On the higher side, it could move up to 24000-24200/79400-79900 On the flip side, below 23600/77500 the sentiment could change. Below the same, he said that traders may prefer to exit out from the trading long positions.
LKP Securities' Rupak De said the Nifty witnessed a strong recovery as the index moved back above the 200DMA, indicating an improving trend. Additionally, the Nifty has broken out of a few days of congestion on the daily timeframe.
"The RSI has entered a bullish crossover near the oversold zone, suggesting positive momentum. The sentiment appears favorable for a meaningful rally in the short term, as long as the index stays above 23,600. Immediate resistance is seen at 23,960–24,000. A decisive move above 24,000 could trigger a rally toward 24,500. On the downside, supports are placed at 23,750 and 23,550," De said.
Nifty Bank concluded the session at 51,135.40, with a gain of 1.51%. The index now holds above its 10-day moving average and is nearing a breakout above the 20-day moving average.
For the Bank Nifty now, experts believe 50500 and 50300 would be key support zones while 20 day SMA or 51250 and 50 day SMA or 51850 could be the crucial resistance areas for the short-term traders.
"A sustained move beyond this level could provide significant room for further upside. Additionally, Nifty Bank is approaching the average line of the daily RSI, which may enhance bullish momentum and strengthen the ongoing trend. The resistance remains at 51,800, while support has shifted upward to 50,700," Mehra said.
Here are the stocks to watch ahead of Monday's trading session:
Escorts Kubota: To commence NBFC business without accepting public deposits from November 26
Aurobindo Pharma: Collab and licence agreement with a global pharma major for respiratory drugs
SBI Card: October cards issuance up 9.6% YoY, spends rise 14.9% MoM
Zomato: To be included in BSE Sensex effective December 23
Cochin Shipyard: MoU with US-based company to develop jack-up rig design for the Indian market
RVNL: JV (RVNL- SCPL) gets LoA for a project worth ₹837 crore From Eastern Railway
RITES: Northeast Frontier Railway revises project work estimate to ₹531.77 crore from ₹288.44 crore.
HG Infra: Gets LoA from NTPC Vidyut Vyapar Nigam for battery energy storage system
CESC: Arm gets LoI to acquire 100% stake in Chandigarh Disco, bid at ₹871 crore
This result is likely to provide political stability, boosting investor sentiment—particularly in infrastructure, urban development, and manufacturing sectors aligned with BJP policies. Stability in Maharashtra could trigger a stock market rally, enhancing investor confidence due to the continuity of pro-business policies, especially after uncertainty from previous coalition shifts.
Friday’s gains helped the market turn positive for the week, snapping a two-week losing streak and regaining half of the losses from the prior week. Notably, 34 of the 50 Nifty stocks recorded gains during the week.
The Nifty posted its best single-day gain in over five months on November 22, rising nearly 2.4%. Buying at lower levels in blue-chip stocks fueled the rally, with several index heavyweights, including Reliance, posting significant gains. Adani Group stocks also saw a recovery, climbing up to 14% from recent lows. These healthy gains helped BSE-listed companies add ₹7 lakh crore in market capitalisation.
On the corporate results front, the Q2FY25 earnings scorecard was weak overall, but excluding commodities, it reflected in-line earnings growth. Siddhartha Khemka of Motilal Oswal expects a recovery in corporate earnings moving forward. However, in the near term, Khemka anticipates continued market volatility driven by state election outcomes, FII activity, and global geopolitical concerns.
Foreign institutions continued to remain net sellers in the cash market on Friday, while domestic institutions were net buyers.
What do the Nifty50 charts suggest?
The Nifty50 index ended the session with an impressive 2.39% gain at 23,907.25, marking a strong relief rally. This momentum carried the index to a weekly gain of 1.59%.
A gap-up start for Nifty 50 and Nifty Bank cannot be ruled out.
"In the daily timeframe, the Nifty formed a bullish engulfing pattern. Nifty has reclaimed the 10 DMA and 200 DMA, though still trailing the 20 DMA. On the hourly chart, the formation of an inverse head-and-shoulders pattern hints at a potential upside, projected to the 24,150–24,200 range. The support has now shifted higher to 23,600 levels. The short-term strategy has altered from ‘sell on the rise’ to ‘buy the dip’, signalling a bullish undertone," said Om Mehra, Technical Analyst, SAMCO Securities.
As long as the market is trading above 200 day SMA or 23600/77500 the pullback formation is likely to continue, believes Amol Athawale of Kotak Securities. On the higher side, it could move up to 24000-24200/79400-79900 On the flip side, below 23600/77500 the sentiment could change. Below the same, he said that traders may prefer to exit out from the trading long positions.
LKP Securities' Rupak De said the Nifty witnessed a strong recovery as the index moved back above the 200DMA, indicating an improving trend. Additionally, the Nifty has broken out of a few days of congestion on the daily timeframe.
"The RSI has entered a bullish crossover near the oversold zone, suggesting positive momentum. The sentiment appears favorable for a meaningful rally in the short term, as long as the index stays above 23,600. Immediate resistance is seen at 23,960–24,000. A decisive move above 24,000 could trigger a rally toward 24,500. On the downside, supports are placed at 23,750 and 23,550," De said.
What do the Nifty Bank charts suggests?
Nifty Bank concluded the session at 51,135.40, with a gain of 1.51%. The index now holds above its 10-day moving average and is nearing a breakout above the 20-day moving average.
For the Bank Nifty now, experts believe 50500 and 50300 would be key support zones while 20 day SMA or 51250 and 50 day SMA or 51850 could be the crucial resistance areas for the short-term traders.
"A sustained move beyond this level could provide significant room for further upside. Additionally, Nifty Bank is approaching the average line of the daily RSI, which may enhance bullish momentum and strengthen the ongoing trend. The resistance remains at 51,800, while support has shifted upward to 50,700," Mehra said.
Here are the stocks to watch ahead of Monday's trading session:
Escorts Kubota: To commence NBFC business without accepting public deposits from November 26
Aurobindo Pharma: Collab and licence agreement with a global pharma major for respiratory drugs
SBI Card: October cards issuance up 9.6% YoY, spends rise 14.9% MoM
Zomato: To be included in BSE Sensex effective December 23
Cochin Shipyard: MoU with US-based company to develop jack-up rig design for the Indian market
RVNL: JV (RVNL- SCPL) gets LoA for a project worth ₹837 crore From Eastern Railway
RITES: Northeast Frontier Railway revises project work estimate to ₹531.77 crore from ₹288.44 crore.
HG Infra: Gets LoA from NTPC Vidyut Vyapar Nigam for battery energy storage system
CESC: Arm gets LoI to acquire 100% stake in Chandigarh Disco, bid at ₹871 crore
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First Published: Nov 24, 2024 2:28 PM IST
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