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Stock Market Daily Updates: 2 Sep 2020

Indian stock market will be keeping an eye on the US-China strained relations on the international front and the US non-pharma employment figures to be released on August 4, September 2020, along with global markets, Traders need to be ready to handle volatility in the near-term.

Photo Credit :

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Dear Trader…

The Indian stock market started trading positive on the thirday day of the week with recovered from sharp correction in the previous session and the bulls managed to hold their ground,

Attempts by Chinese troops to infiltrate India's Ladakh border again on Monday morning have reportedly led to renewed clashes between the two countries' troops. As tensions escalated and SEBI implemented a new pledge and re-pledge margin system in the Indian stock market from September 1, 2020, the initial phase saw a huge two-sided rift. 

The Corona virus epidemic has affected the global economy and the country's GDP contracted by 23.9% in the April-June quarter of FY2020-21 due to low demand and declining investment, the biggest decline in the Indian economy in three years. In contrast, India's manufacturing activity grew in August. Improved production, new orders and improved customer demand have also led to an increase in manufacturing activities since the start of business operations. 

Markets swung on a day the Supreme Court gave mobile service providers 10 years to pay adjusted gross revenue  (AGR) dues, the new margin norms kicked in and the market came to terms with Q1GDP numbers. Liquidity, driven by high FII inflows in August, has provided good support to the market, despite concerns over high valuations in some sectors and stocks.

The Manufacturing Procurement Managers' Index (PMI) of IHS Market India rose to 52 in August from 46 in July. Besides, while the Supreme Court was hearing the AGR case, the Indian stock market closed with a surged, giving telecom companies 10 years to pay AGR dues. 

Friends, Tensions were high between the two countries as tensions escalated amid reports of renewed clashes between Chinese troops and Indian troops on the Ladakh border as the market was moving ahead with the sale of domestic funds due to the uninterrupted flow of FIIs. 

In the coming days, if relations with China deteriorate and a state of war ensues, the market is expected to see a correction from the current level to an estimated 5%. There was a fear that the decline in panic could intensify as the market remained in an overbought position. 

Last week, Reserve Bank Governor Shaktikant Das lauded that the RBI was not tired of trying to get the economy out of the crisis. He has shown readiness for further action. Globally, the US Federal Reserve has also signaled that it will keep interest rates low for a long time without worrying about inflation. Thus, as the market is full of liquidity, the Indian stock market is likely to move lower. The Indian stock market will keep an eye on the results of Coal India for the quarter ending June 2020, as well as the services PMI figures to be released on September 3, 2020, in the corporate results today, September 2, 2020. Along with this, the Indian stock market will be keeping an eye on the US-China strained relations on the international front and the US non-pharma employment figures to be released on August 4, September 2020, along with global markets.

Markets swung on a day the Supreme Court gave mobile service providers 10 years to pay adjusted gross revenue  (AGR) dues, the new margin norms kicked in and the market came to terms with Q1GDP numbers that were released the previous evening.

The market is expecting a slow uptick in economic activity, which has resulted in stock-specific moves, where there is earnings visibility. Investors need to be prepared to handle volatility in the near-term.

Dear Traders…. For the Trading Idea of…

Nifty Future opened @ 11480 as on 02.09.2020

For Intraday, Nifty Future has resistance at 11505 – 11517 Point; above which other resistance levels are at 11533 – 11560 Point with highly Volatile Trend,

Nifty Future has Downside support levels are at 11434 – 11404 Point; below11404 Point, other support levels are at 11388 – 11373 Point.

I am positive for the next bullish trend only above @ 11533 Point but be with the trend. Let the market decide further moves. As we are saying from many days, Buying is suggested in falls only...and it’s still a better strategy in the given Scenario...!!!

Regarding Long term positions, it is preferable to remain cautious now

If Nifty Future crosses @ 11533 Point, again then the upper side target is quite high and it may touch @ 11560 Point in the short term

Bank Nifty Future opened @ 23855 as on 02.09.2020

For Intraday, Bank Nifty Future has resistance at 23909 – 23960 Point; above which other resistance levels are at 24008– 24240 Point with highly Volatile Trend,

Bank Nifty Future has Downside support levels are at 23770 – 23707 Point; below23707 Point, other support levels are at 23660 – 23606 Point.

I am positive for the next bullish trend only above @ 24008 Point but be with the trend. Let the market decide further moves. As we are saying from many days, Buying is suggested in falls only...and it’s still a better strategy in the given Scenario

Regarding Long term positions, it is preferable to remain cautious now

If Bank Nifty Future crosses @ 24008 Point, again then the upper side target is quite high and it may touch @ 24240 Point in the short term

Trading Idea for the derivative stocks….

TECH MAHINDRA FO @ RS 733

Positive Trend @ Rs 733 / 717 with Stop loss of Rs @ 707 for the target near @ Rs 747 - 760 in short term

INFOSYS FO @ RS 920

Positive Trend @ Rs 920 / 909 with Stop loss of Rs @ 898 for the target near @ Rs 944 - 950 in short term

CIPLA FO @ RS 740

Positive Trend @ Rs 740 / 727 with Stop loss of Rs @ 717 for the target near @ Rs 763 - 770 in short term

AURO PHARMA FO @ RS 820

Positive Trend @ Rs 820 / 808 with Stop loss of Rs @ 797 for the target near @ Rs 838 - 850 in short term

RELIANCE FO @ RS 2118

Negative Trend @ Rs 2118 / 2144 with Stop loss of Rs @ 2160 for the target near @ Rs 2097 – 2088 in short term

HDFC FO @ RS 1855

Negative Trend @ Rs 1855 / 1870 with Stop loss of Rs @ 1883 for the target near @ Rs 1830 – 1818 in short term

KOTAK BANK FO @ RS 1422

Negative Trend @ Rs 1422 / 1434 with Stop loss of Rs @ 1440 for the target near @ Rs 1408 – 1397 in short term

LUPIN FO @ RS 963

Negative Trend @ Rs 963 / 977 with Stop loss of Rs @ 988 for the target near @ Rs 944 – 938 in short term.

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Nikhil Bhatt | Research Analyst - SEBI

The author is a well established entrepreneur having a more than 16 years of experience in the field of stock market and financial management.

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