The Nifty 50 ended lower on Friday but still had its best week in two months. From the October 27 lows, which is the start of the November series, the index has gained 800 points. The rally of the truncated Diwali week left investors richer by ₹7 lakh crore.
Three straight weekly gains have put the Nifty 50 within 250 points of the 20,000 mark. However, the 19,800 mark continues to remain a barrier for the index, as Friday was the second day in a row, when the Nifty crossed that mark, but failed to sustain above the same.
“Now that inflation risks are not overly concerning, margin tailwinds may continue, US bond yields have softened, and a sustained earnings trajectory potentially puts India back into focus, even though the upcoming elections are likely to be a distraction,” Amit Sachdeva of HSBC wrote in a note.
After two days of being net buyers in the cash market, FIIs returned to being net sellers on Friday. Interestingly, domestic institutions, who have been consistent buyers all this while, also turned net sellers on Friday.
Nagaraj Shetti of HDFC Securities wrote that even though the near-term uptrend of the market remains intact, there is a possibility of some more consolidation or minor weakness on the Nifty for the next 1-2 sessions. “A decisive breakout of 19,875 (Thursday’s high), is likely to bring more upside for the short term,” he wrote. 19,600 – 19,550 on the downside can act as a short-term support.
The street has respected the buy on dips sentiment since the Nifty crossed 19,500 on the upside, according to Rupak De of LKP Securities. He expects the trend to remain positive as long as the Nifty trades above key averages. On the downside, 19,630 is a support, while 19,850 will remain a resistance zone.
Amol Athawale of Kotak Securities expects rangebound action on the index due to the temporary overbought conditions, although the texture of the market remains positive. He sees 19,900 as a key hurdle for the Nifty, while 19,575 on the downside may act as a key support level.
The Reserve Bank of India’s announcement of asking banks and NBFCs to set aside more capital to back unsecured loans like personal and credit card loans weighed on nearly all banking and financial stocks on Friday.
As a result, the Nifty Bank underperformed on the final trading day of the week, fell back below the mark of 44,000 and also posted a loss for the week. The index declined in three out of the four trading sessions of the week.
Kunal Shah of LKP Securities said that the next support for the Nifty Bank on the downside is in the 43,300 – 43,250 zone. In case that level is broken, the index may fall towards 42,700, while sustaining above those levels may see a recovery back to 44,000.
Kotak Securities’ Athawale mentions that the 20-Day Simple Moving Average of 43,400 will be a crucial support for the Nifty Bank, above which, the index can retest the 50-DMA of 44,200. In case it manages a break above that level, it can see further upside towards 44,500.
What Are The F&O Cues Indicating?
Nifty 50’s November futures shed 2.7% or 2.97 lakh shares in Open Interest. They are now trading at a premium of 74.7 points compared to 64.5 points earlier. On the other hand, the Nifty Bank futures added 7.4% or 1.57 lakh shares in Open Interest. Nifty 50’s Put-Call Ratio is now at 1.02 from 1.17 earlier.
RBL Bank has entered the F&O ban list from Monday’s session, while SAIL is out of the list. Zee Entertainment, Delta Corp, Hindustan Copper, MCX, Chambal Fertilisers, Manappuram Finance and India Cements continue to remain in the F&O ban period.
Nifty 50 on the Call side for November 23 expiry:
For this Thursday’s expiry, the Nifty 50 call strikes between 19,700 and 19,900 saw addition in Open Interest. The 19,800 strike saw the maximum addition in Open Interest.
Strike | OI Change | Premium |
19,800 | 37.89 Lakh Added | 87.15 |
19,900 | 24.85 Lakh Added | 48.2 |
19,700 | 11.87 Lakh Added | 143.55 |
Nifty 50 on the Put side for November 23 expiry:
For this Thursday’s expiry, the Nifty 50 put strikes between 19,650 and 19,800 have seen Open Interest addition.
Strike | OI Change | Premium |
19,650 | 15.34 Lakh Added | 46.15 |
19,750 | 12.44 Lakh Added | 82.5 |
19,800 | 9.18 Lakh Added | 106.55 |
Lets take a look at the stocks that added fresh long positions on Friday, meaning an increase in both price and Open Interest:
Stock | Price Change | OI Change |
Exide Industries | 3.46% | 10.44% |
SBI Life | 4.00% | 9.46% |
Granules India | 1.62% | 8.95% |
MRF | 1.07% | 8.24% |
Can Fin Homes | 2.38% | 8.00% |
Lets look at the stocks that added fresh short positions on Friday, meaning a decrease in price but increase in Open Interest:
Stock | Price Change | OI Change |
SBI Card | -6.11% | 43.21% |
SBI | -3.72% | 29.10% |
RBL Bank | -7.72% | 21.16% |
Aditya Birla Capital | -6.04% | 14.15% |
IDFC First Bank | -3.75% | 9.51% |
Some stocks witnessed short covering on Friday, meaning an increase in price but decrease in Open Interest:
Stock | Price Change | OI Change |
ICICI Prudential | 2.23% | -10.44% |
ABB | 1.37% | -10.25% |
Ramco Cements | 0.59% | -10.11% |
Siemens | 1.33% | -7.51% |
IRCTC | 4.35% | -7.45% |
These stocks saw unwinding of long positions on Friday, meaning a decrease in both price and Open Interest:
Stock | Price Change | OI Change |
Indian Oil | -1.20% | -9.57% |
Manappuram Finance | -4.55% | -6.99% |
India Cements | -1.09% | -6.29% |
Chambal Fertilisers | -0.73% | -5.59% |
MCX | -2.78% | -5.31% |
These are some stocks to watch out for ahead of Monday’s trading session:
First Published: Nov 19, 2023 11:33 AM IST
Omprakash Tiwary is a business writer who delves into the intricacies of the corporate world. With a focus on finance and economic landscape. He offers readers valuable insights into market trends, entrepreneurship, and economic developments.