Index trend and stocks in action on March 19, 2020
Nifty opened higher but the selling pressure quickly grappled the index and it was almost the same old story where, Nifty opened at higher and ended the day near to the lowest point of the day. The benchmark Nifty breached 8,500 level to end at 8,469, down by 5.56 per cent with 44 declining constituents and just six advancing.
The index formed a long bear candle, carrying lower high and lower low as Nifty closed below the low, which was registered on March 13 and also, it made a new three-year low. Nifty has closed below the important support zone of 8,900-9,000 levels. As we mentioned in our write-up that a pullback is quite possible due to the deeply oversold nature of markets, however, their viability is a matter of great concern and this is what we have witnessed. Despite a good start, the markets failed to capitalise on it and closed almost 600 points down from the day’s high.
Going ahead, the next major support is seen around 8,100 mark and the level of 8,550 is likely to act as a resistance on the upside. The daily RSI on the daily time scale is 15.16, which is in oversold territory. However, there is a formation of bullish divergence as it has not made a fresh 14-period low in-line with the index. While, the MACD is deeply bearish as it’s trading below and much away from the signal line.
We would recommend our readers not to buy only because the index is trading in oversold zone since we mentioned that bad markets stay persistently oversold. Wait for the index to form a higher high and higher low on the daily time frame and after a higher high and higher low formation, wait for a follow throughout the day and then only, we can ponder over initiating long position.
Vakrangee: Reserve Bank of India (RBI) has provided the renewal of authorisation for Vakrangee Limited. RBI has extended the validity of authorization issued to Vakrangee Limited for setting up as well as operating White Label ATMs (WLA) in India. The validity has been extended till March 31, 2021.
Srikalahasthi Pipes: Srikalahasthi Pipes has stated that the commercial operation of the company’s second furnace for producing Ferro Silicon has started.
Reliance Industries: Reliance Jio Infocomm Limited (RJIL), a wholly-owned subsidiary of the company, dated March 18, 2020 regarding approval of the scheme of arrangement amongst RJIL and certain classes of its creditors by National Company Law Tribunal (NCLT), Ahmedabad Bench, for the transfer of certain identified liabilities to the company. Accordingly, the identified liabilities of RJIL stands transferred to the company.
Ashok Leyland: The board approved a proposal to acquire up to an additional 19 per cent stake in its NBFC-arm Hinduja Leyland Finance for Rs 1,200 crore.
Alphageo India: Alphageo (India) Limited is in receipt of Notification of Award (NOA) of Contract from Oil India Limited for 2D and 3D seismic data acquisition and processing services in Oil's OALP Areas of Mahanadi Basin (Odisha) for an estimated contract value of Rs 76.67 crore (exclusive of taxes).
IFB Industries: The commercial production of new projects at Verna Goa to manufacture split air conditioners has commenced on March 17, 2020.