Powell Says Rate Hikes May Lead to Recession; Markets Flat - Share Market Today

Here are some of the major updates that could move the markets today:

Stocks

Imagicaaworld Entertainment has completed its debt resolution successfully and inducted new promoters on the board of directors. The board has approved the allotment of equity shares and 0.01 percent redeemable non-convertible preference shares on a preferential basis as part of the resolution plan agreed by the lenders under the RBI Prudential Framework.

Vodafone Idea said the board approved raising of funds up to Rs 436.21 crore from promoter Euro Pacific on a preferential basis. The board also approved the convening of an Extraordinary General Meeting of the company on July 15 to seek approval of shareholders for the said preferential issue.

Bajaj Auto informed exchanges that the board of directors will meet on June 27 to further deliberate on the proposal for the buyback of equity shares of the company.

IRB Infrastructure Developers received 75 percent of the arbitration award of Rs 419 crore from IRB Pathankot Amritsar Toll Road Ltd, an SPV of IRB InvIT Fund. The Court has upheld Arbitral Tribunal's Order and directed NHAI to release 75 percent of the arbitration award amount, i.e. Rs 308 crore, to the company. IRB Infra was the EPC contractor for the Pathankot-Amritsar BOT project.

GPT Infraprojects has bagged an order worth Rs 292 crore for the execution of viaducts, major bridges, ROBs, supply of vehicles, site facilities and other allied works for Khurda Road-Bolangir New BG link project of East Coast Railway. This contract is a joint venture.

What to Expect? 

NIFTY opened with a gap-down at 15,563 and a proper down-trending day followed. No swing points were crossed on the upside and NIFTY ended the day at 15,413, 226 points or 1.44% lower.

BANK NIFTY opened with a gap-down at 33,105 and the first candle was a huge red one. The index consolidated with bearish bias and closed at 32,845, 346 points or 1.04% lower.

Metals fell by nearly 5%.

The US markets were volatile after opening with a gap-down and closed slightly in the red. The European markets closed 1% lower.

The Asian markets are trading slightly in the green. The U.S. Futures and the European futures are trading nearly 0.3% lower.

SGX NIFTY is trading at 15,440 indicating a flat opening.

NIFTY has supports at 15390, 15,315, 15,265 and 15,200. We can expect resistances at 15,460, 15,575 and 15,630.

BANK NIFTY has supports at 32,500, 32,170 and 32,000. Resistances are at 33,000, 33,120 and 33,300.

NIFTY has the highest call OI build-up at 15,700. The highest put OI build-up is at 15,200.

BANK NIFTY has the highest call OI build-up at 33,500 and the largest put OI build-up is at 32,500.

Foreign Institutional Investors net sold shares worth Rs 2,900 crores. Domestic Institutional Investors net bought shares worth Rs 1,900 crores. 

INDIA VIX is at 21.3.

Note that the VIX did not spike despite the fall we had yesterday. We had controlled moves yesterday and we will have to see if the expiry day will be a grinding day or a trending day like the previous expiry.

The W-pattern in BANK NIFTY has failed miserably and the structure looks good for shorting below 32,500 with a target of 32,000. However, look at the hourly candles and you will be able to see an important level at 15,265 in NIFTY where so many wicks were formed below but none of the closes happened. 

UK released the inflation data and the figure is a 40-year high at 9.1%. A number below 9% would have been a relief for the markets.

Jerome Powell in his testimony before the US Congress said that the economy is strong enough to handle interest rate hikes. Though this looks positive in the first look, note that this also means there are going to be consecutive rate hikes. He added later that the rate hikes may lead to a recession. So, the world is giving higher chances for a recession now.

I will be closely watching 15,390 on the downside and 15,575 on the upside. 

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