9,979.10152.95
Stock Analysis, IPO, Mutual Funds, Bonds & More

Ahead of Market: 12 things that will decide stock action on Tuesday

Analysts are of the view that only a fall in virus cases can save D-St from further downfall.

ETMarkets.com|
Last Updated: Mar 23, 2020, 09.49 PM IST
0Comments
Getty Images
Stock20-Getty-1200
NEW DELHI: The rapidly spreading coronavirus pandemic put investors under extreme pressure on Dalal Street on Monday as fears that the outbreak may bring world economies to a screeching halt led to another day of massive sell-off.

Trading on the bourses halted for 45 minutes Nifty slumped 10 per cent.

Analysts said the extreme lockdown measures taken by the government in India and the world over stoked fears of a massive global recession, as curbs imposed by Sebi in cash and F&O segments proved insufficient to tame volatility.

BSE Sensex posted its biggest-ever one-day decline ending at 25,981.24, down 3,934.72 points. Likewise, the 50-share Nifty settled 1,135.20 points lower at 7,610.25.

Analysts are of the view that only a fall in virus cases can save Dalal Street from further downfall.

Harsha Upadhyaya, CIO, Kotak Mahindra AMC said: "The volatility will continue as long as there is no reduction in the spread of Covid-19. While valuations are quite attractive, the near term is so hazy, and hence the downward pressure will continue. It is necessary to be patient while things may remain quite fluid in the near term. One should not panic and not exit equities at such a lower level. It is difficult to predict where the bottom is. However, history has shown that eventually when the dust settles, people make money."

Here’s what indicators are suggesting for the stock market action on Tuesday:

Fed fails to assuage virus worries
Wall Street slipped on Monday as the still rapidly spreading coronavirus forced more US states into lockdown, eclipsing optimism from an unprecedented round of policy easing by the Federal Reserve, Reuters reported. At 9.00 PM (IST), Dow Jones was down 3.77 per cent at 18,451.06, while Nasdaq and S&P 500 were trading up to 2.68 per cent lower.

European stocks sink again as virus deaths mount
European shares were stuck near seven-year lows on rising fears of an outright contraction in global growth for the year after several more countries self-isolated to curtail the spread of the coronavirus pandemic. At 9.00 PM (IST), Euro Stoxx was down 3.10 per cent, while key indices from the UK, Germany and France were up to 4 per cent in the red.

Podcast: Stock derivative volumes to drop 70-80% in next few days


Tech View: Nifty not done with selloff
Nifty shaved off over 1,100 points in a brisk selloff on Monday, the day trading halted on the bourses for the second time in less than a week. Analysts said predicting a bottom in this market is next to impossible, as the bulls have easily capitulated to the bear dominance. For now, they see immediate support at 7,350 and 7,500 levels.

F&O: Not the time for bottom fishing
Nifty formed a bearish candle on the daily chart and made a new four-year low. At its current juncture, the market is in strong bear grip and, thus, is not respecting any support levels. As of now, there is no sign of trend reversal, and thus, traders should refrain from bottom fishing in this market.

Forget market for 6 months, do yoga & keep cash: Kedia

Stocks showing bullish bias
Momentum indicator Moving Average Convergence Divergence (MACD) showed bullish trade setup on the counters of Adani Transmission, Sterling and Wilson, Sadbhav Infrastructure, Bharat Gears and Paisalo Digital. The MACD is known for signalling trend reversals in traded securities or indices. It is the difference between the 26-day and 12-day exponential moving averages. A nine-day exponential moving average, called the signal line, is plotted on top of the MACD to reflect ‘buy’ or ‘sell’ opportunities. When the MACD crosses above the signal line, it gives a bullish signal, indicating that the price of the security may see an upward movement and vice versa.

Stocks signalling weakness ahead
The MACD showed bearish signs on the counters of Bharat Electronics, Nelcast, Lotus Eye Hospital, Gallantt Metal, Jayant Agro, Panacea Biotec, Archidply Industries and Umang Dairies. Bearish crossover on the MACD on these counters indicated that they have just begun their downward journey.

Most active stocks in value terms
HDFC Bank (Rs 1970.79 crore), RIL (Rs 1671.87 crore), ICICI Bank (Rs 1656.37 crore), HDFC (Rs 1504.32 crore), Axis Bank (Rs 1253.28 crore), TCS (Rs 1181.80 crore), Bajaj Finance (Rs 1177.93 crore), SBI (Rs 1152.16 crore), Infosys (Rs 910.79 crore) and ITC (Rs 797.87 crore) were among the most active stocks on Dalal Street on Monday in value terms. Higher activity on a counter in value terms can help identify the counters with highest trading turnovers in the day.

Most active stocks in volume terms
Vodafone Idea (Shares traded: 31.27 crore), YES Bank (Shares traded: 9.38 crore), Ashok Leyland (Shares traded: 6.21 crore), SBI (Shares traded: 6.17 crore), ICICI Bank (Shares traded: 5.68 crore), ITC (Shares traded: 5.13 crore), Indiabulls Housing Finance (Shares traded: 4.11 crore), GMR Infra (Shares traded: 4.00 crore), NTPC (Shares traded: 3.77 crore) and Axis Bank (Shares traded: 3.76 crore) were among the most traded stocks in the session.

Stocks showing buyers’ interest
Ruchi Soya Industries and Ipca Labs witnessed strong buying interest from market participants as they scaled their fresh 52-week highs on Monday signalling bullish sentiment.

Stocks witnessing selling pressure
Chola Investment Finance, Max Financial Services, M&M Financial, Axis Bank and Bajaj Finserv witnessed strong selling pressure in Monday’s session and hit their 52-week lows, signalling bearish sentiment on these counters.
Comments
Add Your Comments
Commenting feature is disabled in your country/region.

Other useful Links


Copyright © 2020 Bennett, Coleman & Co. Ltd. All rights reserved. For reprint rights: Times Syndication Service