Markets likely to continue the momentum of yesterday

19 Oct 2022 , 08:50 AM

Indian equity markets are likely to continue the momentum of yesterday.  There is also the probability of profit booking dominating in the later half of the day. US manufacturing output grew y-o-y by 0.4% in September. This caused some cheer in the US equity markets. They ended in green yesterday. 

US markets saw another volatile day yesterday. Dow Jones gained over 650 points before profit booking saw the day end with gains of 335 points. Nasdaq also closed higher by 97 points before seeing intra-day gains of over 300 points. Oil prices were near 2 week lows at US$83 per barrel. US$ index closed near 112.

 Asian markets have opened mixed. Japanese “Nikkei’ is up by over 200 points in early trade as it consolidates the recent gains. Most other Asian indices are trading mixed, as investors weigh the recent run up, with most opting to book profits. Chinese stocks are proving to be rank underperformers, despite the partial reopening.

Nifty saw another superb day with the index gaining over 175 points, following up on the gains of the previous day. Bank Nifty also logged gains of over 400 points. SBI, PNB and Canara bank leading from the front. Mid-caps also saw the indices rally. Nifty midcap 50 index was up 1.6%. Fall in US$ could see metals rise in tandem with banks.

Technical View: Nifty is likely to find support at around 17350. 17700 is likely to act as resistance. Bank Nifty is likely to find support at around 40200. 41000 is likely to act as resistance on the upside. 

TRADING call (1-2 days) :BUY SAIL October future at 79-79.25.  Stop loss: 77.35. Target: 82

Derivative call- time period:(1 month) : BUY Indigo October future at 1780-1790.  Stop loss: 1748.5. Target: 1821.