Indian equity markets may begin the new year on a positive note

2 Jan 2023 , 08:58 AM

Indian equity markets may start the day on a positive note.  GST collection in December grew year-on-year by 15% to Rs 1.49 lakh crore. This increase may be because of both increased economic activity and also because of more stringent tax collection measures put in place by the Government.

US markets saw a weak closing to the last week of 2022. Dow Jones closed lower by 73 points, after seeing intra-day recovery of over 300 points. Nasdaq closed flat after being down by over 150 points in mid-session. US dollar index closed near 4-month lows at 103.49. Bond yields closed near highs of 3 month @ 3.87%.

 Asian markets have opened in the green, led by the ASX & South Korean markets. Most markets are closed for New Year holiday today. The undertone remains mixed with US$ not rising with yields. This indicates that the worst of inflation & rate tightening may be behind with chances of mild recession in Europe & US in 1st quarter of 2023.

 Nifty saw a smart intra-day opening on Friday. It then got sold into as foreign ETFs sold on the last day of the year. This selling by foreign ETFs was more to balance portfolio, as the undertone remains firm for Indian equity markets. Nifty 50 gyrated over 185 points before closing lower by 85.70 points. Bank Nifty closed lower by 266 points because of profit booking in ICICI, HDFC and IndusInd Bank. Mid-caps saw relative strength. Nifty Small- cap 100 index closed higher by 0.72%.

Technical View: Nifty is likely to find support at around 18050. 18500 is likely to act as resistance. Bank Nifty is likely to find support at around 42500. 43850 is likely to act as resistance on the upside.

Trading call:(1-14 days) BUY SRF January future @ 2300-2310. Stop loss: 2250.15. Target: 2355

Derivative call-time period: (1 months) :BUY L&T January future @ 2090-2110. Stop loss: 2050. Target: 2145.