Pre-Market Insights for Monday: Factors to Evaluate Ahead of the Market Opening

On August 25, the financial markets experienced another day of volatility with a negative opening, continuing a downtrend for the second consecutive session. Here are some key highlights from the financial markets on that day:

Nifty Index:

• The Nifty index closed six-tenths of a percent lower.

• It found support around the 19,230-19,250 area on a closing basis, coinciding with the previous month's low.

• A bullish reversal pattern called the Inverted Hammer was formed on the weekly charts.

• Immediate resistance for the Nifty was expected around 19,400-19,500 levels, coinciding with the 21-day EMA at 19,445.

• If the Nifty broke the support mentioned above, it could potentially drop to the 19,100-19,000 levels.

BSE Sensex:

• The BSE Sensex declined by 366 points to close at 64,887.

• The Nifty50 fell by 121 points to close at 19,266.

• A small bearish candlestick pattern with minor upper and lower shadows was formed on the daily scale, negating the formation of higher highs in the previous four sessions.

Bank Nifty:

• The Bank Nifty saw a negative opening and extended selling pressure but defended the 44,000 mark on a closing basis.

• A candlestick pattern resembling a Doji was formed on the daily charts, indicating indecisiveness among buyers and sellers.

• Immediate support was noted around 43,800 – 43,600, while immediate resistance was seen at 44,500 – 44,800.

• Breaking the strong barrier at 45,000 could trigger positive momentum.

Options Data for Nifty:

• Maximum monthly Call open interest (OI) was at the 19,500 strike with 1.22 crore contracts, serving as a key resistance.

• Maximum Put open interest was seen at the 19,000 strike, possibly acting as crucial support.

• Maximum Call writing was at the 19,300 strike, while maximum Put writing was seen at the 19,100 strike.

• Significant Put unwinding was observed at the 19,400 strike.

Stocks Highlights:

• Some stocks with high delivery percentages included Muthoot Finance, Dabur India, Dalmia Bharat, Alkem Laboratories, and Container Corporation of India.

• Long build-up was seen in Escorts Kubota, Sun TV Network, Vodafone Idea, HDFC Asset Management Company, and Indus Towers.

• Long unwinding was observed in stocks like GMR Airports Infrastructure, Coforge, Laurus Labs, BHEL, and Astral.

• Short build-up occurred in stocks like Persistent Systems, Syngene International, Aditya Birla Capital, IDFC First Bank, and M&M Financial Services.

• Short-covering was seen in RBL Bank, Birlasoft, Gujarat Narmada Valley Fertilizers and Chemicals (GNFC), Metropolis Healthcare, and Asian Paints.

Stocks in the News:

• Reliance Industries' annual general meeting was scheduled for August 28.

• Jio Financial Services' removal from Sensex and BSE indices was postponed to September 1.

• Bharat Electronics received new defense and non-defense orders worth Rs 3,289 crore.

• Garden Reach Shipbuilders & Engineers signed an MoU with the DEMPO Group for commercial vessels.

• Linde India received a Letter of Acceptance from SAIL for a cryogenic oxygen plant.

• HDFC Bank approved the re-appointment of Sanmoy Chakrabarti as Chief Risk Officer for a further five years.

Institutional Activity:

• Foreign institutional investors (FII) sold shares worth Rs 4,638.21 crore, while domestic institutional investors (DII) purchased Rs 1,414.35 crore worth of stocks on August 25.

Disclaimer: Please note that the information provided here is based on the data and analysis available as of the given date and may not reflect the current market conditions or developments. It's advisable to consult with financial experts or conduct your research before making any investment decisions.