24 August 2015


Huge sell-off across the globe led by Chinese equities meltdown and geo-political tension between South Korea and North Korea raised the concerns of investors, denting domestic equity markets that witnessed panic selling pressure on Monday. Continued weakening of rupee also weighed on the sentiment. As a result, the  indices slide around 6 per cent in Monday’s trading session. The Sensex nosedived 1624 points,at 25741. The index opened at 26730 and touched a low of 25624. On the similar lines, the Nifty index tanked 490 points, at 7809. The index opened at 8055 and touched a high and low of 8060 and 7769, respectively. It took 65 days from June 15- August 22 this year for the markets to go up from 7950 to 8650 but it took the bears six days to wipe off these entire gains. Nearly Rs 7 lakh crore got wiped out from the investors’ wealth as rout in Chinese stocks triggered a global sell-off.
Panic has spread to Indian equities too on the back of global rout driven by Chinese actions. During this wave of selling, we may see a lot of investment opportunities from a medium-to-long-term perspective in Indian equities, which is what we are currently focusing on. We currently hold some cash in our portfolios, and will be looking to invest that into equities as the market becomes more attractive with every decline. We may see some recovery in Tuesday’s trading session. For investment perspective, investors avoid banking and real estate stocks in the present market scenario. The Nifty is likely to remain extremely volatile in the current week, more so on account of the August series F&O expiry. However, we tend to think the spot Nifty would, most likely, be held by its major support zone between 7700 and 7600. This zone is unlikely to be breached decisively now at least on the first attempt. It could also lead to bringing back some buying demand.
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RESISTANCE: 7800, 7900, 8000
SUPPORT:  7700, 7600, 7500

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