Dalal Street Corner: Soft end for stock markets this week; what should investors do on monday

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Indian markets extended the decline for the third straight session on Wednesday as HDFC twins – HDFC and HDFC Bank led the market the most along with auto stocks. The BSE Sensex slipped more than 237 points while Nifty50 settled above the 17450 mark at the close, falling 54 points or 0.3%.

Sector-wise, selling pressure was seen in automotive, banking and financial stocks, while consumer staples, metals and pharmaceuticals saw buying interest on Wednesday at the close.

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Out of 50 scripts on Nifty50, 22 advanced and 28 declined at the close. ONGC closed first in gains, nearly 3% higher amid rising crude, followed by Apollo Hospital up more than 2%. On the other hand, Maruti and the HDFC twins were among the main laggards, down in the range of 2-2.5%.

Meanwhile, the mid and small cap indices of the broader markets closed mixed, with the former ending flat with a negative bias and the small caps closing up around 0.2% at the close.

“While global markets have already priced in higher levels of inflation due to high fuel and food prices, the headwinds have dampened investor sentiment,” said Vinod Nair, head of research at Geojit Financial Services in its post-trade commentary.

“The ECB’s policy decision will be closely watched to determine how the central bank plans to balance slowing growth and record inflation. With the onset of earnings season, the market should be supported by sector-specific momentum “, he added.

The scholarship will remain closed on Thursday April 14 due to the birthday of Dr. BR Ambedkar and Mahavir Jayanti, and on Friday April 15 due to Good Friday.

We’ve rounded up the views of different experts on what investors should do when trading resumes:

Expert: S Ranganathan, head of research at LKP Securities.

Capital goods stocks were the most sought after today on expectations of a recovery in investment spending. March exports, up 20%, boosted sentiment, although the street remains cautious about rising inflation and commodity prices and their impact on corporate earnings.

Expert: Rupak De, Senior Technical Analyst at LKP Securities.

Nifty remained volatile with a largely negative bias throughout the session. At the lower end, the index challenged the support levels of 17400-17450. On the upper side, it failed to hold above 17600. Going forward, the weakness may continue.

Crucial support is seen at 17400, below which a serious market correction can be seen. On the upper end, resistance is visible at 17600/17800.

Expert: Kunal Shah – Senior Technical Analyst and Derivatives at LKP Securities.

The Bank Nifty Index saw a new short position build up in the futures segment indicating weakness. The index is however stuck in a wide range between 37,000 and 38,000 and a break to either side will result in trend action. The index, if it breaks above 37,000 marl next week, will pave the way for a further decline towards the 36,000 level.

Expert: Mr. Ajit Mishra, Vice President – Research, Religare Broking Ltd

We have a long weekend ahead of us and the markets will react to two major earnings that are Infosys and HDFC Bank on Monday, April 18, 2022. In addition, any major developments on the global front over the next four days would also impact on feeling.

On the index front, Nifty is currently respecting the first line of defense which is 20 EMA on the daily chart around 17,400 and its breakdown may push the index towards the 17,250 area. 17,650-17,750 would act as an immediate obstacle. We suggest favoring hedged bets and maintaining the focus on stock picking.

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