Indian markets may see some profit booking today

6 Feb 2023 , 08:56 AM

Indian equity markets may see some profit booking today after the rally of Friday. Friday’s rally wiped off a large part of the decline that Indian equity markets have seen since the beginning of this year.

US markets saw profit booking on Friday. January jobs data beat all expectations. This saw bond yields and US dollar rise in tandem. Oil prices fell over 4%. Dow Jones lost 127 points. Nasdaq fell 193 points. Strong jobs numbers with falling inflation may see Federal Reserve remain undecided on further rates trajectory.

Asian markets have opened on a mixed note today. Japanese ‘Nikkei’  is up by over 250 points in early trade. A stronger US dollar is favorable for Japanese exporters. Many Asian markets are seeing  profit booking too as US markets corrected on Friday. The undertone remains strong for equities.  China’s reopening of trade is gathering momentum. 

Nifty saw a sharp rally on Friday, after seeing weakness play out over the previous 2 days. FY 24 Budget met & beat all expectations. The Adani collateral selling was a damper as the stock prices fell sharply due to leveraged trades. Results from Bank of Baroda and SBI set the tone. Banks reported one of the best ever profits with one of the highest ever NII, NIM and better asset quality. Bank Nifty led with gains of over 830 points . Nifty rose 240 points. Titan, Adani Ports and Bajaj twins led the gainers. Profit booking was seen in Divi’s Lab, Adani Ent and BPCL.

Technical View: Nifty is likely to find support at around 17550. 18150 is likely to act as resistance. Bank Nifty is likely to find support at around 40500. 42050 is likely to act as resistance on the upside.

Trading call:(1-14 days) : BUY IDFC First February future @ 58.75-59.25. Stop loss: 57.80. Target: 60.5.

Derivative call-time period: (1 months): BUY Bank Baroda February future @162-164. Stop loss: 159.65. Target: 166.5.