Markets Nosedived During the Last Weekly Session Ahead of Budget

During the previous week, Nifty witnessed a steep fall, going below the levels of 14,000 and nearing 13,700. The market has remained highly volatile, with Nifty and Sensex countersigning a movement of around 310 and 1,118 points respectively in a single day on 27th January. On 21st January, Sensex crossed 50,000 mark for the first time in the history, to reach 50,184 and touched the lows of 47,270 on 27th January.

Many events have played a major role which has resulted in a highly volatile market. Investors had mixed sentiments due to a mixed corporate results season. They were highly disappointed by the Reliance’s quarterly result, which resulted in sell-off of the script, dragging the markets to its lows. Additionally, monthly F/O expiry also weighed on the markets. Budget has also been one of the main reasons for high volatility. Also, the India’s volatility index has increased from 18 in mid-December to 25 in the last week. The markets have also been witnessing selling pressure from FIIs, and FPIs since a week, due to weak global cues. Additionally, the farmers’ protest which has been going on since last five months, has been having a worse effect on the economic activity of our country, which has impacted equity markets.

Major Economic events such as lower than expected UK’s retail sales, Flash Manufacturing PMI, Flash Services PMI, French Flash Services PMI, US’ crude oil inventories and Durable Goods Orders weighed on the equity markets. However, the losses were limited to some extent, after the investors’ sentiments were lifted a bit after the release of better than expected US’ unemployment claims numbers, Philly Fed Manufacturing Index, Flash Manufacturing and Services PMI, French Flash Manufacturing PMI, German Flash Services PMI and Eurozone’s Flash Services PMI.

As far as sectoral indices are concerned, all the indices were in red during the previous week, with Nifty Metals, Nifty Energy and Nifty Private Bank indices being the worst performers, losing around 6.2% each. Nifty Financial Services, Nifty PSU Banks and Nifty Realty lost more than 5% each, whereas, Nifty Auto, Nifty Pharma and Nifty IT indices fell by more than 1.5% each.

For the upcoming week, the equity market is expected to witness the highest volatility, as compared to past few weeks, ahead of the budget. We expect Nifty to be in the range of 14,662 to 13,000 for the week, whereas, we expect Bank Nifty to be in the range of 31,821 to 27,989.

Page 8, Nav Gujarat Samay Newspaper – 29 Jan 2021

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Precious Metals Witnessed a Volatile Weekly Session

During the previous week in the COMEX market, prices of base metals such as Aluminum, Zinc, Iron Ore, and Lead continued its downward journey for the second consecutive week. However, Gold and Silver witnessed kind of a volatile weekly session, but gold managed to close almost at par, whereas silver gained marginally by 0.3% as compared to the previous week.

During the week, gold and silver reached highs of $1,874 and $26.1 respectively in the COMEX market, as the US President Joe Biden was preparing to be sworn into office as the 46th President and had declared his intentions to inject more stimulus ($ 1.9 trillion) to the country’s economy, which will revive the economic growth. As a result, the dollar index weakened 0.16% to 90.323 while the yield on 10-year Treasuries held at 1.08%. Gold and silver are considered a hedge against inflation and currency debasement that can result from stimulus measures, which explains the rise in the prices. Additionally, increase in new COVID-19 cases in the US and Canada, has also been supporting the prices of precious metals.

However, during the week, the precious metals prices lost all its gains after the COMEX market witnessed major profit booking by the investors in the following trading sessions. Also, the dollar index gained on the back of better than expected economic data for the US economy, such as Unemployment Claims, Building Permits, Housing Starts, Flash manufacturing and services PMI, which further resulted in the fall of precious metals prices.

For the current week, investors will have to keep a watch on certain global economic data such as US’ CB Consumer Confidence on 26th January, 2021, US’ crude oil inventories, FOMC’s statement and Federal Funds Rate on 27th January, 2021, US’ Advance GDP QoQ, Unemployment claims and goods trade balance on 28th January, 2021. Along with these data, development relating to virus outbreak and vaccine progress, trend in US dollar and more clarity on polices from Biden administration may continue to remain key price determining factor for gold and silver.

In the current week, we expect gold in COMEX market to be in the range of $1,912 to $1,787, while silver is expected to be in the range of $26.9 to $23.3. Whereas, as per our prediction for bullion market traders, gold futures will trade in the range of 46,983 to 51,826.

Page 6, Nav Gujarat Samay Newspaper, 26 Jan 2021

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Morning Market Insight Report – 29 Jan 2021

Bank Nifty Intraday Outlook

In yesterday’s trading session, Bank Nifty gained 0.24% after losing in the first session. Private Banks gained 0.17% and PSU banks fell 1.76%.

We expect intraday range could be 29,753-30,808 with sideways to negative momentum & broader range could be expected between 29,451 to 31,108 zone for this week.

Bank Nifty Daily Chart

Nifty Intraday Outlook

In yesterday’s trading session, Nifty closed in red again due to monthly F/O expiry and ahead of Union Budget.

We expect intraday range could be 13,493-14,068 with sideways to negative momentum while broader range could be 13,343 to 14,218.

Nifty Daily Chart

Short and Long term moving averages

Daily Market Statistics

Major global & domestic economic events

Results Calendar

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