Monday's session saw the continuation of consolidation in the Indian market as the equity benchmarks Sensex and Nifty closed lower for the second consecutive session.
Losses in shares of bank and financial heavyweights amid mixed global cues kept the market down. Rupee's slide against the US dollar also weighed on investor sentiment.
The Indian currency closed 30 paise lower at 70.87 per dollar on September 30.
The Sensex closed with a loss of 155 points, or 0.40 percent, at 38,667.33, with 13 stocks in the green and 17 in the red.
The Nifty pack closed 38 points, or 0.33 percent, lower at 11,474.45, with 22 stocks up and 28 down.
The broader markets suffered more than the frontline indices. BSE Midcap and Smallcap indices declined 1.13 percent and 1.21 percent, respectively, underperforming BSE Sensex.
Market experts expect the consolidation in the market to continue until the result season begins. Moreover, all eyes are now on the RBI's monetary policy meet on October 4 which will give a direction to the market in the near-term.
"We expect that in the near-term, the RBI policy outcome will provide some direction to the market. Further, the market is likely to remain rangebound until the beginning of the earnings season from mid-October. Global developments, particularly US-China trade war, and crude oil prices may continue to induce volatility in the market," said Ajit Mishra, Vice
President - Research at Religare Broking.
After two consecutive sessions of losses, both Sensex and Nifty have retreated nearly 1 percent. The overall market capitalisation of BSE-listed firms dropped to Rs 1,47,17,456.10 crore from Rs 1,48,45,854.70 crore on September 26, making investors poorer by Rs 1.28 lakh crore in two sessions.
Meanwhile, foreign institutional investors (FIIs) sold shares worth Rs 469.4 crore, while domestic institutional investors (DIIs) bought shares of worth Rs 504.69 crore in the Indian equity market on September 30, as per provisional data available on the NSE.
Big News: Core sector output declines by 0.5% in August
The eight core industries in August recorded a 0.5 percent decline in output of coal, crude oil, natural gas, cement, and electricity, according to a government data released on September 30.
The eight core sector industries - coal, crude oil, natural gas, refinery products, fertiliser, steel, cement and electricity - had expanded by 4.7 percent in August last year.
Coal, crude oil, natural gas, cement, and electricity recorded a negative growth of 8.6 percent, 5.4 percent , 3.9 percent, 4.9 percent and 2.9 percent, respectively, in August, according to the data of the Commerce and Industry Ministry.
However, fertiliser and steel production grew by 2.9 percent, and 5 percent, respectively during the month under review.
Technical view:
Nifty ended above its 5-EMA placed around 11,450 levels and formed a hammer pattern on daily charts as decline was being bought into the market but at the same time supply is intact at higher zones.
Hammer is a bullish reversal pattern formed after a decline. A hammer consists of no upper shadow, a small body, and a long lower shadow. The long lower shadow of the hammer signifies that it tested its support where demand was located and then bounced back.
Experts feel if the index sees a positive trend then the bullish implication could take it towards 11,600-11,700 levels in coming sessions.
Three levels of Nifty:
Intraday low- 11,390.8 | Intraday high- 11,508.2 | 200-DMA- 11,247.
Max Call OI: 11,500, 12,000
Max Put OI: 11,000, 11,500
Stocks in news:
Punjab National Bank: The bank received Rs 3,000 crore from the Government of India.
Bank of Baroda: Lender received a capital infusion of Rs 7,000 crore from Government of India.
PNB Housing Finance: Sunil Mehta resigned as Chairman.
Cadila: The drugmaker has entered into an asset purchase agreement with Medicure lnc., a cardiovascular pharmaceutical company.
NBCC: Company signed MoU with the government for Rs 400 crore Manipur project.
Technical Recommendations:
We spoke to Nandish Shah, Senior Technical and Derivatives Analyst at HDFC Securities and here’s what he has to recommend:
Reliance Industries: Buy | LTP: Rs 1,333.40 | Stop loss : Rs 1,285 | Target: Rs 1,410 | Upside: 6%
UPL: Buy | LTP: Rs 601.25 | Stop loss: Rs 580 | Target: Rs 640 | Upside: 6%
Quess Corp: Buy | LTP: Rs 471 | Stop loss: Rs 440 | Target: Rs 520 | Upside: 11%
Disclosure: Reliance Industries Ltd. is the sole beneficiary of Independent Media Trust which controls Network18 Media & Investments Ltd.
(Disclaimer: The views and investment tips expressed by investment expert on Moneycontrol.com are his own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.)
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