Market extends fall; IT, Teck top drags

The Indian market benchmark Sensex fell for the second consecutive day on November 22 on losses led by IT and bank heavyweights such as Infosys, HDFC Bank and TCS.

The market remained in the lower terrain throughout the session even as global cues remained broadly positive after China said it wanted to work out a trade deal with the US.

Most IT and technology stocks suffered losses amid reports that H-1B visas might see some changes to protect US workers and wages.

“Despite positive global cues, the equity benchmark indices ended Friday’s session sharply lower. We expect the Indian markets to remain under pressure in the near-term, as there are no visible positive triggers, which could boost investor sentiments. We would recommend investors to follow stock specific approach,” said Ajit Mishra, Vice President – Research, Religare Broking.

Sensex suffered a loss of 216 points, or 0.53 percent, at 40,359.41 while Nifty ended 54 points, or 0.45 percent, lower at 11,914.40.

Among the broader market indices, BSE Midcap closed with losses of 0.14 percent while BSE Smallcap ended flat.

Infosys, TCS, Asian Paints, HCL Tech and Kotak Mahindra Bank were the top losers. On the other hand, Tata Steel, NTPC, Vedanta and ONGC emerged as the top gainers.

Stocks and Sectors

On the sectoral front, BSE IT and Teck fell 2 percent each. BSE Telecom slipped nearly 2 percent. BSE Metal index closed 2 percent higher.

Volumen spike of 100-300 percent was seen in stocks like Equitas, Wipro, Mindtree, Torrent Pharma and Bajaj Finance.

Long Buildup – Eicher Motors, Equitas Holdings, Zee

Short Buildup – Adani Power, Infosys, UPL

Stocks in the news

Shares of Dewan Housing Finance Corporation were locked in the 5 percent upper circuit after a media report had indicated that Adani Group had shown interest to acquire the company.

Ujjivan Financial Services share price gained 4,26 percent after Macquarie had maintained its neutral rating and raised its target price to Rs 325 from Rs 260 per share.

NTPC share price rose 2 percent intraday after Morgan Stanley had upgraded the rating of the company to overweight, with a target at Rs 152 per share.

Zee Entertainment Enterprises share price climbed 4 percent after the company’s promoter group had sold more than 14 crore shares in bulk deals on November 21.

Technical View

Nifty formed a Doji on the weekly chart, which shows indecision in the minds of the market participants. On November 22, Nifty breached a rising trend line on the hourly chart and tumbled towards the 20 DMA (11,879). The bulls, however, managed to defend the key short term moving average, which would be the key for future course of action.

“The breach of the crucial support would mean continuation of the fall till the subsequent key short term moving average i.e. 40 DEMA (11683). On the other hand, till the time Nifty holds on to the 20 DMA it can bounce towards 12,040 in order to form last leg of an Ending Diagonal pattern,” said Gaurav Ratnaparkhi, Senior Technical Analyst, Sharekhan by BNP Paribas.

Three levels to watch on November 25 would be 11883.5, 11960.5, 11968.1

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