Index trend and stocks in action January 06, 2020

Indian markets began the New Year with new hopes, as the improving market breadth, together with the good GST collection, improved PMI data etc., was seen lifting market participants sentiments. As most of the factors turned rosy and just when everyone on the street was hoping for a fresh all-time high, came the major twist, which dragged Nifty lower and the all-time high level became so near yet so far. The rising tension in the Middle East spooked investors and the index ended the week with a nominal loss of 19 points or 0.16 per cent.

Nifty traded in a range for the third consecutive week. After a breakout of 26 trading session and about 327 points range, it has now shifted to 175 points range above the prior consolidation zone for the past 12 trading sessions. Technically, there was no significant weakness visible in the index, as it has not made even a minor lower low. However, at the same time, the bullish strength in the index is clearly waning.

Our observations for the last three weeks are that Nifty has formed a parallel top, the bulls are struggling to leap forward as on every rise, and selling pressure is building up. For the week gone by, the index added two distribution days while one distribution day expired, making the current distribution count as six. The addition of distribution days is not a good sign for the markets.

Nifty is also forming a rising wedge, which is a bearish structure. Moreover, the pattern breakdown level and the consolidation of last 12 days' support confluence at around 12,118. Hence, for the bulls, this level is of utmost importance. In any case, if the index becomes close below this level, the minor trend will turn into a bearish one. Meanwhile, on the higher side, a move above 12,300 mark is likely to open gates for further upside.  

Dixon Technologies: Dixon Technologies partners with SAMSUNG for the manufacturing of LED TVs.

Titan: Q3 jewellery revenue grew at 11 per cent, the retail growth was much better at 15 per cent. Fragrances business witnessed a growth in excess of 20 per cent.

Vedanta: The Board meeting is scheduled on January 8 to consider issue of NCD worth Rs 2,000 crore in one or more tranches.

MSTC: An agreement for E-commerce services has been entered into by Security Printing & Minting Corporation of India Limited and MSTC Limited, wherein, MSTC Limited shall provide E-commerce services to Security Printing & Minting Corporation of India Limited.

IRB Infrastructure Developers: The company has received the No Objection Certificate (NOC) from the National Highway Authority of India (NHAI) for the transfer of nine BOT SPVs to IRB Infrastructure Trust and subsequent investment by GIC affiliates for 49 per cent stake in the Trust.

Sobha: The total sales volume is up by 17 per cent in Q3FY20 as compared to Q3FY19 and by 9 per cent during 9M-20 compared to 9M-19.