NIFTY OUTLOOK & OPTION CALL PUT TIPS FOR 21 JUN 2024

Market Overview

Indian benchmark indices ended marginally higher in a volatile trading session on June 20, 2024. The Sensex gained 141 points to close at 77,478, while the Nifty increased by 51 points to end at 23,567.

Market Highlights

• Top Nifty Gainers:

  • Grasim Industries
  • Hindalco Industries
  • JSW Steel
  • Adani Ports
  • BPCL

• Top Nifty Losers:

  • Hero MotoCorp
  • Sun Pharma
  • M&M (Mahindra & Mahindra)
  • NTPC
  • Wipro

• Sectoral Performance:

  • Gainers: Metals, Capital Goods, Realty, Oil & Gas
  • Losers: Auto, Pharma, PSU Banks

Market Dynamics

The session was marked by significant volatility but ultimately concluded on a positive note. Key influencing factors included:

• Domestic Factors:
  • Anticipation of the upcoming Union Budget.
  • Progress of the monsoon season.
• Global Factors:
  • Decline in US bond yields, leading to robust Foreign Institutional Investor (FII) inflows.

Fertilizer stocks showed substantial momentum due to the proposed removal of GST and an increase in the Minimum Support Price (MSP).

Technical Analysis

• The Nifty formed a small negative candle on the daily chart, indicative of a Doji type candle pattern, suggesting indecision and broader sideways range movement.
• Immediate Support Level: 23,450
• Resistance Level: 23,660
• Short-term Upside Target: 23,950

Despite minor knee-jerk reactions, the Nifty displayed gradual upward momentum within a narrow range. The overall trend remains range-bound, with potential minor intraday weaknesses around the 23,750-23,800 levels, which could present short-term buying opportunities.

Sectoral Performance

• Metal and Realty: Top performers with over 1% gains.
• Auto: Continued profit-booking corrections.
• Pharma: Ended as the major laggard.
• Chemical and Fertilizer Stocks: Dominated the trade, soaring in the range of ~10-20%.

Market Sentiment

The market exhibited cautious optimism, particularly as US indices were closed on Wednesday, influencing domestic investors' sentiment. The trend of outperformance by Mid and Smallcap stocks resumed after a brief pause, indicated by the Spinning Top candlestick pattern, suggesting continued protection at the lower side of 23,340 and resistance at 23,660.

Closing Summary

The Indian stock market experienced a mixed but ultimately positive session. Investor focus remains on the upcoming Union Budget and monsoon progress, while global cues, particularly US bond yields, continue to impact FII inflows. Sectoral rotations were evident, with selective buying in certain sectors like Metals and Realty, while others like Auto and Pharma faced selling pressure.

Market Outlook

In the near term, markets are likely to continue experiencing range-bound movements with potential minor weaknesses providing buying opportunities. Investors should watch the 23,750-23,800 levels for possible intraday weakness and the 23,950 level as the near-term upside target.