Indian equity benchmarks scaled record closing highs on Thursday led by IT and PSU bank stocks. Strength in broader markets also boosted investors' sentiment. Losses in pharma scrips, however, played spoilsport.

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NSE

The Nifty50 index extended its winning run to the fourth session in a row.

So, what do the charts suggest for Dalal Street?

The index formed a long positive candle on the daily chart in a positive sign, and one may expect upside breakout in the coming session, said Nagaraj Shetti, Technical Research Analyst at HDFC Securities.

"Overall market breadth turned into positive on Thursday and an upside reversal pattern formed in broad market indices after a decline of 5-6 sessions... One may expect upside bounce in these segments in the short term," he said.

Nifty headed towards 16,500?

"The index formed a bullish continuation formation after a reversal formation the previous day. On that basis, Nifty50 is poised to move towards 16,450-16,500 levels," said Shrikant Chouhan, Executive Vice President, Equity Technical Research at Kotak Securities.

Here are key things to know about the market before Friday's session:

SGX Nifty

Nifty futures trading on Singapore Exchange -- an early indicator of the NSE Nifty50 benchmark in India -- was down one point at 16,378.50 at 8:04 am, indicating a flat start ahead on Dalal Street.

What to expect

"Nifty50's overall chart pattern and the positive reversal in broader indices hints at the possibility of an upside breakout of small range in the coming sessions. The next upside level to be watched is 16,500," HDFC Securities' Shetti said.

Global markets

Most Asian markets fell despite record highs hit elsewhere globally. MSCI's broadest index of Asia-Pacific shares outside Japan fell 0.59 percent, halting a three-day winning run. Japan's Nikkei 22 index dropped 0.6 percent. Overnight, MSCI's gauge of stocks across the globe hit a new record high. On Wall Street, and the Dow and S&P 500 indices hit record closing highs for a third straight day. Earlier, European equities had equalled their longest winning streak since 2017, rising for the ninth day in a row.

Call/put open interest

There is a high concentration of call open interest is at the strike price of 16,400, and then 16,500. On the other hand, the maximum put open interest is at the strike price of 16,300, NSE data shows. This indicates that immediate resistance can be expected at 16,400, followed by 16,500, and support at 16,300.

Key levels to watch out for

Nifty50: "On Friday, the index will have immediate support at 16,325, followed by 16,300-16,220, and the next resistance at 16,400, followed by 16,450-16,500 levels," according to Rahul Sharma, Co-Founder, Equity99.

Nifty Bank: Immediate support is seen at 35,770, followed by 35,580 and 35,430 levels. Resistance is placed at 36,100-36,200-36,400 levels, he said.

Long build-up

Here are five stocks that saw an increase in open interest as well as price, suggesting a build-up of long positions:

Long unwinding

(Decrease in open interest and price)

Short-covering

(Decrease in open interest and increase in price)

Short build-up

(Increase in open interest and decrease in price)

Volatility gauge

India VIX index -- which measures the expectation of volatility in the market -- eased 2.67 percent to 12.37, after dropping as much as 10.62 percent to 11.36 during Thursday's session.

FII/DII flow

Foreign institutional investors withdrew a net Rs 212.11 crore from the Indian capital market on Thursday. Net purchases by domestic institutional investors stood at Rs 307.75 crore, exchange data showed.

Earnings to watch

More than 800 companies are scheduled to report their quarterly numbers on Friday, including ONGC, Petronet, Godfrey Phillips, SpiceJet, Grasim, Suzlon, Future Consumer, Godrej Industries, GMR Infra, Hindustan Aeronautics, Fortis Healthcare and Glenmark Pharma. NBCC, Allcargo Logistics, J&K Bank, NHPC, Burger King, Camlin Fine Sciences, MOIL, NLC and Omaxe will also post their results on the same day.

(Edited by : Abhishek Jha)

First Published:Aug 12, 2021 7:55 PM IST