Market activity remained laggard on Thursday with Nifty 50 ending in marginal negative terrain to hold firmly above 18000 levels. The levels of 18513 still pose a major risk for markets as the current rebound has been led by non-technology stocks within the Nifty 50 Index. In case we plot, the data of the Nifty 50 Index ex-IT, it clearly shows the formation of the rising wedge which construes like a Wave 5 ending phase and a reversal may force the Nifty 50 to correct at least 21%.
Adding to it, global indices like Nasdaq Composite have also slipped below ultra-long-term support of 1000-DMA which was not violated even during the 2020 crisis, and this also poses a further downside risk of another 35% in the near term. In short, though there is no change in the bullishness in Indian markets, this is time to take a pause and re-enter longs above 18513.
Nifty 50 Ex-IT Index & Nasdaq Composite
Stocks to watch
Positive Read Through
- Bharat Electronics Pact with Motorola for Broadband, Push-To-Talk
- Adani Enterprise- reports strong coal trading volumes and margin trading volumes up 68% YoY
- Amara Raja- Revenue growth at 19%, profit growth at 39.5%, margin up 140 bps YoY
- Rain Inds- Revenue up 53%, margin at 22.6% vs 18.8% YoY
- JK Lakshmi Cement- EBIDTA at Rs 139 cr vs estimate of Rs 123 cr, profit at Rs 59 cr
- EClerx- to consider share buyback with results on Nov 10
- HOEC- resumes gas sales from its B-80 field with a D2 well in the western offshore
Negative Read Through
- Hero MotoCorp Net Income -10% YoY to Rs 7.16b, misses est. 7.71b; revenue +7.4% to 90.75b
- Vodafone Idea 2Q net loss Rs 76b, est. loss 69.75b, revenue +13% to 106.1b; Net debt Rs 2.2 tln; Ebitda margin 38.6% vs. 41.1% YoY
- IEX Oct total volume at 7971, down 13% YoY, down 2% MoM
- Blue Star- earnings miss estimates, revenue up 27%, margin at 5.4% vs 5.6% YoY
- Ajanta Pharma- margin at 20.9% vs 29.7%, Profit slips 20% YoY
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