Trade Setup For Nov. 7: Nifty 50 Poised For Breakout, Target Set At 25,130

The NSE Nifty 50 is on the verge of a breakout from a descending broadening wedge formation, according to Aditya Gaggar, director of Progressive Share Brokers. In case of a successful breakout, the approximate target for Nifty is 25,130, with the support moving higher to 24,300, he said.

Shrikant Chouhan, head equity research at Kotak Securities, expects the Nifty 50 to touch 24,700–24,800 soon if the index remains above 24,400. "However, if the market (Nifty) fails to sustain above 24,500, it could correct and retest the previous resistance levels, which were at 24,300–24,200," he said.

Global developments have certainly uplifted sentiments, but we will keep a close watch for the next couple of days, said Osho Krishan, senior analyst, technical and derivatives at Angel One Ltd. "A decisive follow-up move from hereon could provide the necessary momentum for a significant move in the near future. Additionally, there is clear evidence of sectoral rotation, so it is important to adjust our focus accordingly to achieve better performance," he said.

FII/DII Activity

Overseas investors remained net sellers of Indian equities for the 28th consecutive session on Wednesday, while domestic institutional investors also stayed net buyers.

Foreign portfolio investors sold stocks worth Rs 4,445.6 crore, and the DIIs mopped up stock's worth approximately Rs 4,889.3 crore.

F&O Cues

The Nifty November futures were up by 1.22% to 24,587 at a premium of 103 points, with the open interest up by 0.6%.

The Nifty Bank November futures were up by 0.55% to 52,650 at a premium of 333 points, while its open interest was up 3%.

The open interest distribution for the Nifty 50 Nov. 7 expiry series indicated most activity at 27,000 call strikes, with the 24,000 put strikes having maximum open interest.

For the Bank Nifty options expiry on Nov. 6, the maximum call open interest was at 52,500 and the maximum put open interest was at 50,000.

Stocks In The News

• Polycab India: The company has emerged as the lowest bidder for Rs 1,550 crore project from BSNL.

• UltraTech Cement: The company has bought an additional 11.6% stake in UAE-based unit Ras Al Khaimah for $22.02 million.

• Reliance Power: The company's unit, Rosa Power, has repaid Rs 485 crore in debt to Varde Partners, achieving a zero-debt status. The company will now focus on pursuing growth opportunities in the clean and green power sector.

Market Recap

The NSE Nifty 50 and the BSE Sensex ended with over 1% gain on Wednesday, with Infosys Ltd., Tata Consultancy Services Ltd. and overall technology stocks contributing to the benchmark indices' rally amid Donald Trump's victory in the US elections.

The Nifty 50 ended 270.75 points or 1.12% higher at 24,484.05, and the Sensex closed 901.50 points or 1.13% up at 80,378.13.

Global Cues 

Stocks in the Asia-Pacific region opened mixed on Thursday following Wall Street's record rally as investors positioned their portfolios ahead of Donald Trump's return to the White House.

Equity benchmarks in South Korea and Australia opened lower while the Japanese stocks were marginally higher. The Nikkei was 446 points, or 1.14%, higher at 39,880, while the Kospi was down 19 points, or 0.71%, at 2,548 as of 5:35 a.m.

Most stocks in Asia ended the previous session with gains as investors weighed in on the possibility of Trump's second term as he led the presidential race against Kamala Harris, which he later won. Kamala Harris later conceded the election and told supporters to accept her election loss.

The S&P 500 had its best post-Election Day session in history while the Nasdaq 100 rose to a fresh record. The S&P 500 and Dow Jones Industrial Average advanced 2.53% and 3.57%, respectively, while the Nasdaq Composite climbed 2.95%.

The Philippines' GDP print, Australia's commerce figures, and China's foreign reserves and trade data are among the key points to watch out for in Asia on Thursday.

Crude oil prices steadied as traders weighed the likely impact of Trump's election victory. Brent crude was trading 0.81% lower at $74.92 a barrel as of 6:00 a.m. IST. West Texas Intermediate was up 0.03% at $71.71.   

Key Levels

• US Dollar Index at 105.08.

• US 10-year bond yield at 4.44%.

• Brent crude fell 0.81% at $74.92 per barrel.

• Bitcoin was down 0.94% at $75,242.56

• Gold spot was up 0.16% at $2,663.31

Money Market

The Indian rupee hit a fresh record low on Wednesday in the face of a resurgent US dollar and uncertainty over the US presidential election results. The domestic unit had opened lower for the third consecutive session earlier today.

Rupee depreciated 15 paise in the day so far to Rs 84.25 against the greenback. It had opened at Rs 84.16, marking a fresh low, compared to Tuesday's close of Rs 84.1075, and surpassing its previous all-time low of Rs 84.1225 hit earlier this week.