WEEKLY TRENDSETTER (SEPT 29th ,2023
| 2023 | Sep 15 | Sep 23 | Ch % |
| NIFTY | 20192 | 19674 | -2.57 |
| BANK NIFTY | 46231 | 44612 | -3.5 |
| USD/INR | 83.14 | 83.1 | -0.05 |
MARKET REVIEW–The euphoria of all time high on the Nifty was short lived as profit-taking set in sending the large caps, mid-caps and small -caps on a correction mode. Banking stocks bore the brunt of selling led by HDFC Bank (-8%) which also has a high weightage in both indices. The correction could probably continue in the early part of next week before expiry mood takes over.
Interesting cues
BOND INCLUSION IN JP MORGAN INDEX-Come June 2024 ,23 Indian bonds with a notional value of $330 bn will become part of the JP Morgan bond index. The share is expected to rise to 10% in 10 months with an incremental rate of 1% per month. This comes after Russian bonds were excluded. Currently only 19% of the limit is being utilised by FPIs and thus being part of global indices will boost sentiments and increase investments to begin with which will reduce borrowing costs and strengthen the rupee which has been facing the heat against the dollar in the past few weeks. On the flip side the bond markets will also become vulnerable to a sell -off in case there is a global financial problem as happened in 2008.Thus RBI s role will become more challenging and spike in yields will be sharp. Overall considering the large infra projects on the anvil, the inflow of funds is coming at an appropriate time and costs also will be cheaper.
Zee merger with Sony impact on shareholders
Last month the merger was approved by NCLT and the merger impact will be seen soon. For every 100 shares of Zee, shareholders will get 85 shares of the merged entity. The merged entity will become the largest entertainment network in India with a 36% share in TV market and 33% in the Hindi movie channels. The OTT segment which is showing strong growth and with the merger Sony Liv and Zee5 will strengthen presence particularly in the Hindi heartland where it has a strong presence as compared to the metros where Netflix and Prime Video dominate. The subscription base could get a big boost of at least 10-15%. Thus, the merger is keenly awaited and the reaction on the bourses is expected to be positive.
MARKET OUTLOOK
Some technical cues are as follows going by market trends: –
NIFTY – The index slid below 20000 on sharp profit-taking and the 8% slide in HDFC Bank did not help matters with a 14.4 % weightage in the index. Near term support should emerge around 19500.
BANK NIFTY-The index where HDFC Bank has 29% weightage wilted under selling pressure in the counter and saw it sliding 3.5%. While 43800 will be a critical support and nearly 800 points away, the weakness in the HDFC Bank counter could still pose a threat. Ideally 44300-500 should act as a strong support level.
PICKS FOR THE WEEK-
Zee Ent (265)-The scrip saw a strong rally from 225 to 290 before entering a correction mode. Support is seen around 250-55 and accordingly buying can be considered for a possible target of 300 in the coming weeks.
HCC (26.3)-The scrip is coming out of a major downtrend and after a correction looks ready to resume its uptrend. Buying at declines can be considered for a possible target of 30 in the coming weeks.
Note: Any queries /clarifications may be addressed to stockmasala@gmail.com .