Markets for the month of November began on a positive note with the Nifty 50 Index closing well above the 8-month high followed by confirmation of the ‘Monthly Breakout’. The breakout setup has clearly opened the gateway towards 19867 but with one important ‘Caveat’.
It becomes necessary from now onwards that Nifty 50 clears the hurdle of 18513 in the next few days else there is a 10% probability that the entire structure may turn out to be an ‘Ending Triangle’ with a downside potential risk of 14700.
So, ideally, the strategy to deal with this risk is to adopt hedging with 17000 PE for a few days till Nifty 50 crosses the 18513 mark. So far Indian markets have seen outperformance by a wide margin of 25% and ‘the law of averages suggests it is Arsenal’s turn to beat their neighbors’. So from now onwards if global markets are unable to see recovery, there may turn out to be a major risk for India.
Nifty 50 Index
Stocks to watch
Positive Read through
- Adani Ports’ results are ahead of expectations, and Volume guidance is maintained.
- Tech Mahindra- Q2 results in-line, CC Revenue growth at 2.9%, margin at 11.4%.
- Eicher Motors- Reports record Royal Enfield sales, total sales up 86% YoY.
- TVS Motors- Total sales are up 2%, and Scooter sales are up 20% YoY.
- Alembic Pharma gets a USFDA nod for the generic version of Glycopyrrolate injection.
- ABB India inaugurates its first smart instrumentation factory in Bengaluru.
- Macrotech Developers- Profit up 28%, revenue slips 17% YoY, price growth at 2%.
- JK Tyre- Revenue up 26%, EBIDTA up 2% YoY.
- Karnataka Bank- Profit up nearly 4x, NII 26% YoY.
Negative Read through
- Hero Moto- Sales remain below 5 lakh, and total sales slip 17%.
- Coal India- October offtake down 5% production up 6% YoY.
- Voltas- earnings below estimates, margin down 190 bps YoY.
- LIC Hsg Finance- Weak earnings, NII at Rs 1163 cr vs estimate of Rs 1611 cr.
- Kansai Nerolac- Margin up 30 bps, Co sees subdued Q3 demand.
- SML Isuzu- Total sales slip 22% YoY in October.
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