Unexpected Surge in Inflation - Pre Market Analysis

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

Stocks

Nykaa reported 68% year-on-year fall in consolidated net profit at Rs 9 crore for the quarter ended December. Revenue from operations, meanwhile, surged 33% year-on-year to Rs 1,462 crore for the quarter under review.

Media company Zee Entertainment's consolidated net profit fell 91% year-on-year to just Rs 24 crore for the three months ended December period. Total income during the quarter under review was flat at Rs 2,127 crore.

Krsnaa Diagnostics posted a net profit of Rs 14 crore for the quarter ended December as against Rs 16 crore in the corresponding quarter of last year. Revenues, meanwhile, increased 11% year-on-year to Rs 118 crore in the third quarter.

Power Finance Corporation's net profit rose 8% year-on-year to Rs 3,860 crore in the three months ended December period, while net interest income is down 7% to Rs 7,218 crore.

Adani Enterprises will announce its third quarter results today.

What to Expect Today?

NIFTY opened flat at 17,861 and moved down. The index took support at 17,720 and attempted a W breakout but failed. NIFTY closed at 17,771, down by 86 points or 0.48%.

BANK NIFTY opened flat at 41,572 and underperformed. It was a 500 points range. BNF closed at 41,282, down by 277 points or 0.67%.

FIN NIFTY opened flat at 18,508. There was a down-move and attempts of recovery failed. FIN NIFTY closed at 18,429, down by 87 points or 0.47%.

IT moved down by 1.9%.

The US markets moved up yesterday. The  European markets also rallied.

The Asian markets are trading higher.

The U.S. Futures and European futures are trading slightly in the red.

SGX NIFTY is trading at 17,800 indicating a flat to gap-up opening.

NIFTY has supports at 17,720, 17,650 and 17,580. We can expect resistances at 17,800, 17,915, 17,970 and 18,000.

BANK NIFTY has supports at  41,100, 41,000 and 40,700. Resistances are at 41,400, 41,600, 41,800 and 42,000.

FIN NIFTY has supports at 18,340, 18,250 and 18,110. Resistances are at 18,450, 18,550 and 18,660.

NIFTY has the highest call OI build-up at 18,000. The highest put OI build-up is at 17,800.

BANK NIFTY has the highest call OI build-up at 41,500. The highest put OI build-up also is at 41,500.

FINNIFTY has the highest call OI build-up at 18,500. The highest put OI build-up is at 18,400.

INDIA VIX spiked to 13.7.

Foreign Institutional Investors net-bought shares worth Rs 1,300 crores. Domestic Institutional Investors also net-bought shares worth 500 crores.

The day-candle in NIFTY ended red yesterday after three green candles formed though the last two were dojis. Yesterday’s support was at the close of 7th February.

The Adani group fell yesterday after they cut their revenue growth by 50%. Adani Enterprises will release its quarterly results today.

India’s CPI report was a shock as we were expecting the data at around 5.9% from the previous month’s 5.7%. But the figure came out at 6.52%. This unexpected surge may lead to negativity in the markets amid global positivity. The base effect could have been one reason for this spike. Food prices played a role.

US inflation will be out today. And this is going to be more important than India’s CPI. There will be uncertainty in the market and the overnight positional traders will have to be more careful.

It is FIN NIFTY expiry today. 18,400 has been the point of highest put OI build-up and there is a support at 18,340. 18,450 and 18,550 are the levels to watch on the upside.

The global cues are neutral to positive with the US markets moving higher and the other markets following them but Japan’s economic data came out weak. With an unexpected spike in inflation and oil prices rising, we cannot say that the local factors are positive.

I will watch 17,720 on the downside in NIFTY. 17,800 can be watched on the upside.

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