What further enthused the bulls is that the Nifty not only recovered from the day’s low, which came at the midpoint of the 23,400 – 23,300 support zone, but also ended in the positive territory well above the 23,500 mark.
However, the day was mixed for the broader markets. The midcap index closed with gains, rising nearly 700 points from the day's low, but the smallcap index, despite recovering from the lows, could not recoup its losses.
A few key sectors dominated Monday's trade. Fertilizer stocks, which had surged sharply throughout the previous week, sold off sharply on Monday as there was no progress on GST rate cuts for the sector. On the other hand, holding company stocks saw a rally, with most of them closing 20% higher following SEBI's circular on special call option for fair price discovery. You can read more about it here.
Till the end of the series, barring any specific trigger, market action is likely to remain restricted to specific sectors. The market is also awaiting the presentation of the Union Budget, the official date of which is yet to be announced. However, ahead of the Union Budget, companies will start reporting their business updates for the June quarter from next week, followed by their quarterly results.
Immediate support for Nifty is placed at 23,350 – 23,300, which is the level from where Nifty made a recovery on Monday. As long as this is sustained, the momentum remains positive, said Ruchit Jain of 5paisa.com. On the upside, 23,650 – 23,700 is a level for Nifty, which if crossed, could take the index towards 23,900 – 24,000.
Rajesh Bhosale advises to avoid aggressive bets on the index and focus on the range by buying on dips and booking longs at higher levels. Key support for Nifty remains at 23,350, followed by 89-EMA at 23,300 on hourly charts. On the upside, 23,650 – 23,700 is the hurdle.
According to Shrikant Chouhan of Kotak Securities, 23,400 will be a key support for Nifty day traders. Above these levels, Nifty has the potential to touch 23,670 or even 23,750 levels. On the downside, a drop below 23,400 could trigger selling towards 23,320 or 23,275 levels.
Last week's star Nifty Bank also witnessed a buying-on-dips pattern. That was not the only positive from Monday's session. It also managed to hold its previous record high of 51,133, reversed from 51,138 levels and rose nearly 600 points from the lows. The index is now only 250 points away from its recent high of 51,957.
Rishikesh Yedve of Asit C Mehta Investment Intermediates said Nifty Bank has recently retested the breakout point which indicates strength. He advised to continue with the buy on dips strategy till the index reaches 51,000 points. On the upside, 52,000 will continue to act as a hurdle.
Om Mehra of Samco Securities said the daily MACD and RSI indicators remain positive, indicating continued bullish strength. Only a break above the 52,000 level will take the index towards the 52,440 – 52,500 range.
What are the F&O signals indicating?
These stocks added new long positions on Monday, meaning both price and open interest increased:
| store | price change | OI Changes |
| Shriram Finance | 1.89% | 13.42% |
| UltraTech | 1.01% | 8.46% |
| Chola Finance | 2.65% | 7.34% |
| InfoEdge | 3.37% | 5.60% |
| SBI Card | 0.20% | 5.42% |
These stocks added new short positions on Monday, meaning an increase in open interest but a drop in price:
| store | price change | OI Changes |
| SBI Life | -0.57% | 6.50% |
| Voyage | -3.70% | 5.59% |
| Aurobindo Pharma | -1.64% | 5.59% |
| Glenmark | -0.82% | 5.52% |
| Indusind Bank | -2.18% | 5.38% |
These names witnessed short covering on Monday, which means a rise in price but a drop in open interest:
| store | price change | OI Changes |
| Aditya Birla Fashion | 0.81% | -25.39% |
| JK Cement | 0.16% | -23.43% |
| M&M Finance | 0.02% | -21.81% |
| United Breweries | 0.96% | -21.45% |
| Gujarat Gas | 1.47% | -20.39% |
These stocks saw long positions expiry on Monday, meaning both price and open interest fell:
| store | price change | OI Changes |
| New Fluorine | -0.99% | -25.89% |
| NMDC | -1.65% | -21.07% |
| Coromandel International | -0.35% | -19.13% |
| Escorts Kubota | -1.47% | -16.17% |
| Syngene | -0.75% | -15.50% |
These are the stocks to watch out for ahead of Tuesday's trading session:
- Immortal King Energy: Amara Raja Advanced Cell Technologies Pvt Ltd, a wholly owned subsidiary, has signed a technology licensing agreement with GIB EnergyXSlovakia. As part of the agreement, GIB EnergyX will license Goshan's world-class LFP technology for lithium-ion cells to Amara Raja. The agreement enables Amara Raja to manufacture world-class LFP cells in both cylindrical and prismatic form factors.
- Craftsman Automation: Sunbeam Lighting Solutions Pvt Ltd and Kedaara Capital Fund II LLP have signed a Memorandum of Understanding under which the entire or part of Sunbeam's business, excluding certain specified assets of Sunbeam located in Gurugram, will be acquired in one or more tranches. Completion of the proposed transaction is subject to due diligence, final Board approval, execution of definitive documents and fulfillment of customary conditions.
- Borosil: QIP launched to raise funds. The floor price of ₹331.75 is 4.4% lower than Monday's closing price. The company may, at its discretion, offer a discount of 5% on the floor price to the issue price of the QIP.
- Swan Energy: A share purchase agreement has been entered into to purchase 49% of the total equity in TOPL from Indian Farmers Fertilizer Cooperative Limited (IFFCO) at a total price of ₹440 crore. The first tranche of ₹400 crore has already been paid to IFFCO.
- S.H. Kelkar: Keva Flavours Pvt Ltd, a wholly-owned subsidiary, has entered into a share purchase agreement to sell its 40% stake in Newtaste Food & Drink Labs Pvt Ltd. After this sale, KFL will still hold a 40% stake in Newtaste. The sale price is ₹12.5 crore.
- Muthoot Capital Services: To enter into the insurance business after commencement of registration as a Corporate Agent with the Insurance Regulatory and Development Authority of India (IRDAI).
- Vishnu Prakash R Pungalia: Contract for construction of 15 MLD water treatment plant awarded by Public Works Department, Goa. Total contract value of the tender is ₹67.8 crore.
- Kims: The board will meet on June 28 to consider the stock split.
- RBL Bank: The board will meet on June 27 to consider raising funds.
- AU Small Finance Banks: The board will meet on June 27 to consider raising funds.
- Satin Creditcare: The board will meet on June 27 to consider raising funds.
- IND-SWIFT Laboratories: The board will meet on June 27 to consider raising funds.