Almost all the heavyweights in the index, be it Reliance Industries, Infosys, TCS and ITC, put up their hands on Friday to lift the Nifty to a new record high of 24,861 points. The index started the August F&O series with a 400-point surge, a level it had reached throughout a series in July. And unlike previous cases, the index also managed to end close to the day’s high, which should reassure the bulls.
While IT and Reliance sectors contributed to the rally, the recovery in banks also contributed to Friday’s gain. The Nifty Bank index recovered nearly 900 points from the day’s lows and, barring HDFC Bank, most of the index’s constituents contributed to the rally. Infosys, which is trading at a two-year high, is also nearing a record high.
August has always been a good time for the Nifty as barring a 400-point drop last year, the index has gained nearly 600 points in 2022 and even 850 points in 2021. With Friday’s move, the index is now 165 points away from crossing the 25,000-mark. If that happens on Monday, it would have taken the index 21 sessions from June 27, when it crossed the 24,000-mark, to cross another 1,000 points.
A range of reactions to the results will be seen during Monday’s trading session. Stocks like IndusInd Bank, Bandhan Bank, Power Grid, KEC International, Kaynes Tech among others will react to the results released after hours on Friday. But the reaction to ICICI Bank, which released its results on Saturday, will be the key to determining whether the Nifty manages to cross the 25,000-mark or not. Besides ICICI Bank, stocks like PNB, Anant Raj, MCX, Spandana Sphoorty, Dr Reddy’s Laboratories, Genus Power among others will also react to the results.
Monday’s session will see stocks like ACC, BEL, Adani Total Gas, CSB Bankk, Data Patterns, HPCL, Kansai Nerolac, Strides Pharma, Kalpataru projects etc. reporting their results.
Both foreign and domestic institutions were net buyers in the spot market on Friday. The figures may also be skewed due to the block trade that took place in Sobha on Friday morning.
Amol Athawale expects 25,000 to be a key hurdle for the bulls, but breaching it could take the Nifty to 25,150 levels. 24,675-24,600 on the downside now becomes a major support, below which the sentiment could change.
Rajesh Bhosale of Angel One says momentum indicators are still in overbought territory and advises avoiding complacency. He sees support on the downside at 24,600, while 25,000 on the downside will act as the first barrier. If the Nifty breaches 25,000, it can lead to bullish levels of 25,340.
The short term trend of the Nifty is turning positive with the next upside level seen between 25,000 and 25,100, said Nagaraj Shetti of HDFC Securities. The immediate support on the downside lies at 24,650.
As we have highlighted earlier, the rally in the Nifty Bank also contributed to the Nifty hitting a record high on Friday. ICICI Bank’s reaction will be a key reaction to watch and that will be the key determinant of the Nifty Bank’s move on Monday. The index also closed above the 51,200 mark and will target the 51,500 mark on Monday, which has been a key resistance in recent times.
The Nifty Bank formed a bullish belt on the daily charts and closed above 51,100 on a weekly basis, signalling some strength, said Hrishikesh Yedve of Asit C Mehta Investment Interrmediates. In the near term, 51,800-52,000 will be the key resistance levels for the index.
Om Mehra of SAMCO Securities said the Nifty Bank has bounced back from lower levels, maintaining its position above the 50,000 mark and above the 50-day moving average. The support on the downside remains at 50,900 and any correction towards 51,000 could be a buying opportunity for the target of 51,800-51,900 on the upside.
What do F&O signals mean?
These stocks added new long positions on Friday, meaning an increase in both price and open interest:
| Action | Price change | Change of OI |
| Indian Cements | 3.01% | 40.33% |
| Apollo Tires | 1.71% | 28.86% |
| Finance Manappuram | 4.16% | 16.10% |
| TVS Engine | 2.55% | 13.30% |
| Kubota Escorts | 1.73% | 9.83% |
These stocks saw new short positions added on Friday, meaning a drop in price but an increase in open interest:
| Action | Price change | Change of OI |
| Fluor Navin | -0.08% | 8.79% |
| ONGC | -1.01% | 4.56% |
| First IDFC Bank | -0.05% | 4.07% |
| Indian oil | -0.28% | 2.82% |
| Federal Bank | -3.21% | 2.47% |
Short covering was observed on these stocks on Friday, meaning an increase in price but a decrease in open interest:
| Action | Price change | Change of OI |
| Ashok Leyland | 6.13% | -14.39% |
| Mahindra Technology | 0.46% | -12.09% |
| Syngene | 2.40% | -10.90% |
| Petronet LNG | 1.78% | -9.40% |
| JSPL | 3.57% | -8.51% |
Here are the stocks to watch ahead of Monday’s trading session:
- ICICI Bank: Deposits growth 15.1% YoY to ₹14.2 lakh crore. Advances growth up 15.7% YoY to ₹12.23 lakh crore. Net interest income up 13.1% YoY to ₹23,460 crore. Net profit up 10% to ₹11,696 crore. Gross NPA at 2.15% vs 2.16% in March, Net NPA at 0.43% vs 0.42% in March. Slippages up 15.1% sequentially to ₹5,916 crore. Watchlist down 4.4% to ₹5,286 crore. Profit up 88.6% sequentially to ₹1,316 crore.
- UltraTech / India Cements: UltraTech Cements to acquire 28.42% stake from promoters and another 4.3% from other associates of India Cements at ₹390 per share for ₹3,954 crore. UltraTech also announces open offer for 26% stake in India Cements at ₹390 per share. Open offer for India Cements at a premium of 4% over Friday’s close. UltraTech had acquired 22.7% stake in India Cements in June through block deals.
- GNP: Deposits growth of 8.5% YoY at ₹14.08 lakh crore. Forward growth of 14% YoY at ₹9.83 lakh crore. Net interest income up 10.2% YoY at ₹10,476 crore. Net profit up 159% YoY at ₹3,251 crore. Gross NPA at 4.98% vs 5.73% in March. Net NPA at 0.6% vs 0.73% in March. Slippages declined 20.4% sequentially to ₹1,755 crore. Gross NPA forecasts have been revised to around 4%, down from 5% for FY2025. Credit cost forecasts for the year have been revised to less than 0.5%, down from less than 1% previously.
- RITES: The board of directors will meet on July 31 to consider a bonus share issue. The group had previously announced a 1:4 bonus in 2019.
cnbctv18-forexlive
