Trade Setup For July 5: Nifty Poised For Gains If Support At 24,200 Holds

Indian equities may test the levels of 24,500-24,600, after making a new high of 24,401 levels on Thursday. This is contingent on the index holding support at 24,200.

The rally was a mixed bag with buying seen in sectors like IT, pharma and automobiles.

"We expect this ongoing momentum to continue and Nifty to consolidate in a broader range," Siddhartha Khemka, head of retail research at Motilal Oswal Financial Services Ltd., told NDTV Profit.

According to Shrikant Chouhan, head of equity research at Kotak Securities, day traders should watch the immediate breakout levels of 24,400/80,390. If the market rises above these levels, it could rally up to 24,500-24,525/80,700-80,800.

"Conversely, if the market falls below 24,280/80,000, sentiment could shift negatively, potentially leading the market to retest the levels of 24,200-24,165/79,700-79,550," Chouhan said.

Kush Bohra, founder of Kushbohra.com, said he won't initiate a fresh short position on the Nifty. Bohra said the Bank Nifty is beginning to show negative divergence.

Bank Nifty also opened with a gap and registered a fresh high of 53,357.7, but witnessed profit booking. Finally, Bank Nifty settled the day on a flat note at 53,104.

"From a technical standpoint, the index is consolidating in the band of 52,000-53,200. If the index sustains above 53,200 on an hourly basis, then the rally could extend towards 54,000-54,200 levels," according to Hrishikesh Yedve, AVP technical and derivatives research at Asit C Mehta Investment Intermediates Ltd.

The GIFT Nifty was trading 6.5 points, or 0.03%, higher at 24,365 as of 06:36 a.m.

F&O Action

The Nifty July futures are up 0.1% to 24,359 at a premium of 57.3 points, with open interest up by 0.43%.

Nifty Bank July futures are up by 0.19% to 53,166 at a premium of 62.5 points, while its open interest is up by 0.37%.

The open interest distribution for the Nifty 50 July 11 expiry series indicated most activity at 25,000 call strikes, with 23,000 put strikes having maximum open interest.

For the Bank Nifty options July 10 expiry, the maximum call open interest was at 55,000 and the maximum put open interest was at 53,000.

FII/DII Activity

Overseas investors stayed net buyers of Indian equities for the second consecutive day on Thursday.

Foreign portfolio investors mopped up stocks worth Rs 2,575.9 crore, domestic institutional investors stayed net buyers for the second session and sold equities worth Rs 2,375.2 crore, the NSE data showed.

Market Recap

The benchmark equity indices extended their record rally for the second consecutive session but ended little changed on Thursday as gains in information technology shares were offset by losses in HDFC Bank Ltd.

The NSE Nifty 50 ended 15.65 points or 0.06% up at 24,302.15, while the S&P BSE Sensex was 62.87 points or 0.08% up at 80,049.67, closing above the 80,000 mark for the first time.

During the day, the Nifty rose as much as 0.47% to an intraday record high of 24,401 and the Sensex gained 0.51% to an all-time high of 80,392.64.

The broader markets outperformed as the BSE MidCap and the SmallCap ended 0.60% and 0.62% higher respectively.

On the BSE, 16 sectors advanced and four declined, with Healthcare rising the most and Consumer Durables declining the most.

Major Stocks In News

• HDFC Bank: The bank's gross advances fell 0.8% quarter-on-quarter at Rs 24.87 lakh crore, while the deposits were flat at Rs 23.79 lakh crore. CASA deposits were down 5% quarter-on-quarter at Rs 8.63 lakh crore for the end of the first quarter in FY25.

• Raymond: The company approved the demerger of its real estate arm, Raymond Realty subject to approval of shareholders and regulators. The company will issue 6.65 crore shares of Raymond Realty having a face value of Rs 10 per share, upon demerger.

• Punjab National Bank: The bank's domestic advances were up 12.1% year-on-year at Rs 9.89 lakh crore, while domestic deposits grew 8.1% year-on-year at Rs 13.7 lakh crore. Global advances were up 12.7% at Rs 10.33 lakh crore and global deposits were up 8.5% at Rs 14.08 lakh crore for the end of the first quarter in FY25.

• RBL Bank: The bank's total deposits went up 18% year-on-year at Rs 1.01 lakh crore, while gross advances were up 18% at Rs 88,455 crore. CASA ratio was at 32.6% against 35.2% reported in the previous quarter.

• Life Insurance Corporation of India: The company acquired 2.48% of the additional stake in IDFC First Bank for Rs 1,500 crore. The current stake stands at 2.68%.

Global Cues

Stocks in the Asia-Pacific region were trading mixed on Friday as investors await fresh catalysts from election results in the United Kingdom and ahead of the US jobs data.

Japanese and Australian stocks slipped in early trade while the South Korean stocks inched higher. The Nikkei 225 was 52 points or 0.13% lower at 40,8549 while the Kospi was 18 points or 0.66% up at 2,843 as of 06:29 a.m.

Meanwhile, European stocks rose amid key election results and aided by the expectation of rate cuts by the US Federal Reserve. The CAC 40 benchmark index advanced by 0.83%, while Euro Stoxx 50 rose by 0.44% on Thursday.

The US markets and banks were shut on account of their Independence Day. The US futures were trading on a mixed note as Dow Jones futures rose while that of the Nasdaq declined.

Brent crude was trading 0.09% higher at $87.51 a barrel. Gold was 0.11% up at $2,359.27 an ounce.

Key Levels

• U.S. Dollar Index at 105.09

• U.S. 10-year bond yield at 4.37%

• Brent crude up 0.09% at $87.51 per barrel

• Bitcoin was down 2.14% at $57,082.88

• Gold spot was up 0.11% at $2,359.27

Money Market Update

The Indian rupee strengthened against the greenback on Thursday, as both the dollar index and crude oil prices fell.

The local currency strengthened by 3 paise to close at Rs 83.50 and opened flat at Rs 83.54 against the dollar.