Nifty Can See Further Weakness At This Level, Says Analyst
For Bank Nifty 48,500-48,700 level will be the key support level, according to the analyst.
The Nifty has been in consolidation mode and some weakness can be seen in the next one or two sessions, according to Nagaraj Shetti, technical and derivative analyst at HDFC Securities Ltd. The benchmark index will find support in the 22,300–22,250 range, while it may face resistance at the 22,800–22,850 level.
India's benchmark equity indices ended Thursday on a positive note, with gains led by HDFC Bank Ltd. and Power Grid Corp. of India, but the upside was limited due to losses in the shares of ICICI Bank Ltd. and Kotak Mahindra Bank Ltd.
The NSE Nifty 50 ended 52.30 points up, or 0.23%, at 22,657.15, and the S&P BSE Sensex gained 128.33 points, or 0.17%, to close at 74,611.11.
Nifty Bank has been consolidating and the index is under selling pressure, building from a 50,000 level, but there is no expectation of any bigger decline. The 48,500–48,700 level will be the key support level, Shetti said.
Vinit Bolinjkar, head of research at Ventura Securities Ltd., is bullish on Adani Ports, Special Economic Zone Ltd. and REC Ltd. on strong fundamental factors, which include an ambitious port infrastructure pipeline for the former and a planned doubling of assets under management for the latter.
In terms of the dip in Godrej Group stocks following the family's announcement of an agreement to divide the group into two, Shetti said some more weakness and correction can happen, especially for the flagship Godrej Industries Ltd.
The dispute has been resolved amicably and there will not be an impact on normal business operations as key listed companies will remain with Adi Godrej, said Bolinjkar. "Thursday's reaction was knee-jerk. Market will discuss the business growth and accordingly, stock prices will react. It is a good opportunity to add quality companies to the portfolio."
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