Domestic stocks continued to be hammered amid fears about the spread of coronavirus and back home concerns over possible cascading effect of the YES Bank crisis.
Domestic equity benchmark Sensex fell 720 points, or 1.88 per cent, for the week to close at 37,576, while Nifty dropped 212 points, or 1.89 per cent, to 10,989.While the YES Bank fiasco came in as an out-of-syllabus question for Dalal Street, it also raised questions over the stability of the overall Indian financial system.The Indian market is facing a double whammy.
While the global markets are struggling on the back of coronavirus worries, the Yes Bank fiasco has come as a major setback.
There is a need for some clarity on both domestic and global fronts for the market to witness any pullback; otherwise the pain will persist, said Santosh Meena, Senior Analyst, Tradingbells.Latest update on coronavirusTwo more people succumbed to the novel coronavirus in Washington state, bringing the nationwide toll to 19, while the number of confirmed cases in New York rose to 89.
Italy announced lockdown of the entire region of Lombardy and a number of provinces in other regions, affecting a quarter of the Italian population.
World Health Organization said there were at least 103,168 cases till now while global deaths were pegged at 3,507.Oil war breaks outSaudi Arabia, the worlds largest oil exporter, started an oil price war on Saturday by slashing the prices it sells crude into foreign markets by the most in at least 20 years, offering unprecedented discounts in Europe, the Far East and the United States to entice refiners to purchase Saudi crude at the expense of other suppliers.
The nation also plans to increase oil output next month, going well above 10 million barrels a day, as the kingdom responds aggressively to the collapse of its Opec+ alliance with Russia.While those factors set the stage for global equity markets for the week ahead, the YES Bank crisis will also add to investor anxiety in the domestic market, which will operate a day less next week because of the official Holi break on Tuesday.Be that as it may, heres what the internal indicators are suggesting for the domestic market.F-O signals: Dont try to catch a falling knifeThe week gone-by was majorly dominated by bears as we witnessed selling pressure at higher levels.
Nifty continued to make lower highs - lower lows for third consecutive week and closed below its crucial support of 100 EMA and rising trend line on weekly scale, which doesnt bode well for the bulls.
The RSI oscillator also gave trend line breakdown on weekly chart, indicating further weakness in the index.
Resistance is gradually shifting lower and now 11,250 and 11,433 levels would be immediate hurdles for the index.Supports are placed at 11,800 and then 11,650 levels.
Till the time, volatility doesnt cools down, a strong reversal signal is unlikely to emerge.
On the options front, maximum Call open interest was at 12,000 and then 11,500 levels while maximum Put OI was at 11,000 and then 10,500 levels.
There was Call writing at 11,000 and 11,500 levels and Put unwinding at all immediate strike prices.
Option data indicated a shift in trading range to 10,600-11,333 zone.
Analysts advised traders to avoid bottom fishing as it would be like catching a falling knife.
Tech view: Nifty tech charts indecisiveNifty formed an indecisive 'Spinning Top' on the daily chart on Friday.
It is in the oversold zone and levels around 10,800-900 could offer some support.
On the upside, the index should face resistance around the 11,100-11,200 zone, analysts said.
In terms of the price pattern, Nifty has broken down from a multi-month Ending Diagonal pattern, which suggests it is in a downtrend, not only for the short term, but also for the medium term.Stocks showing bullish biasMomentum indicator Moving Average Convergence Divergence (MACD) on Friday showed bullish trade setup on the counters of Syndicate Bank, Biocon, Pidilite Industries, Future Enterprises, Asian Paints, SMS Pharmaceuticals, J B Chemicals - Pharma, SMS Lifesciences, Gateway Distriparks, Venus Remedies, PI Industries, Vidhi Specialty Food, Biofil Chemicals, Astec Lifesciences, Finolex Industries and Pearl Polymers.The MACD is known for signalling trend reversals in traded securities or indices.
It is the difference between the 26-day and 12-day exponential moving averages.
A nine-day exponential moving average, called the signal line, is plotted on top of the MACD to reflect buy or sell opportunities.
When the MACD crosses above the signal line, it gives a bullish signal, indicating that the price of the security may see an upward movement and vice versa.Stocks signalling bearish biasThe MACD showed bearish signs on the counters of YES Bank, Zee Entertainment, Suzlon Energy, NLC India, Ajanta Pharma, Ipca Laboratories, Omaxe, Vivimed Labs, Mukand, Responsive Industries, Star Cement, SORIL Infra Resource, BF Investment, Ortin Laboratories, Sutlej Textiles, The Mandhana Retail, Ravi Kumar Distiller, Hatsun Agro, MPS, Gandhi Special, Asahi Songwon Colors and PDS Multi Fashions.
Bearish crossover on the MACD on these counters indicated that they have just begun their downward journey.
Fridays most active stocks in volume termsYES Bank (Shares traded: 126.46 crore), Vodafone Idea (Shares traded: 33.85 crore), SBI (Shares traded: 10.60 crore), Tata Motors (Shares traded: 8.40 crore), Ibull HousingFin (Shares traded: 4.32 crore), GMR Infra (Shares traded: 4.31 crore), RBL Bank Ltd.
(Shares traded: 3.71 crore), ICICI Bank (Shares traded: 3.10 crore), IDFC First Bank (Shares traded: 2.78 crore) and ITC (Shares traded: 2.68 crore) were among the most traded stocks in the session.Fridays most active stocks in value termsSBI (Rs 2850.91 crore), RIL (Rs 1960.36 crore), YES Bank (Rs 1865.32 crore), IndusInd Bank (Rs 1662.02 crore), ICICI Bank (Rs 1510.52 crore), Bajaj Finance (Rs 1372.92 crore), HDFC Bank (Rs 1295.77 crore), HDFC (Rs 1143.95 crore), Indiabulls Housing Finance (Rs 1090.17 crore) and Tata Motors (Rs 964.70 crore) were among the most active stocks on Dalal Street on Friday in value terms.
Higher activity on a counter in value terms can help identify the counters with highest trading turnovers in the day.Stocks seeing buying interestPidilite Industries, Divi's Laboratories and Sanofi India witnessed strong buying interest from market participants as they scaled their fresh 52-week highs on Friday signalling bullish sentiment.Stocks seeing selling pressureYES Bank, United Bank, Allahabad Bank, Spicejet and Piramal Enterprises witnessed strong selling pressure in Fridays session and hit their 52-week lows, signalling bearish sentiment on these counters.Buzzing sectors in Fridays trade Among the sectoral indices on the BSE, the Metal index settled 4.4 per cent down at 8029.73 .
Other sectoral indices that ended lower included Auto ( down 0.88 per cent), IT ( down 1.39 per cent), Bankex ( down 3.46 per cent), Consumer Durables ( down 1.37 per cent), Capital Goods ( down 1.72 per cent) and Power (down 2.49 per cent).European markets in deep depressionEuropean stocks fell sharply Friday as the coronavirus outbreak continues to impact businesses worldwide.
The pan-European Stoxx 600 closed 3.6% lower provisionally, with oil and gas shares sinking 5.5% to lead losses as all sectors and major bourses slid into the red.
FTSE fell 3.6 per cent on Friday to close at 6,462, Dax lost 3.37 per cent to 11,541 and CAC slipped 4.14 per cent to 5,139.Downslide continues in US marketsUS stocks, bond yields and oil prices dropped sharply again Friday, extending a roller coaster week as investors continued to weigh the global economic disruption from the virus outbreak.
Dow dropped 256 points to close at 25,864, cutting losses after briefly sliding nearly 900 points.
The S-P500 declined 1.7% to end at 2,972.37, putting the broad index off 12% from its recent high.
The technology-heavy Nasdaq Composite fell 1.9% to finish at 8,575.