Trade Setup For Friday: Top Key Factors To Know Before The Opening Bell; Intraday Stocks To Buy

Indian market may open between flat to red on Friday due to mixed performance in Asian stocks as traders await US job data it is expected to provide some clarity for the upcoming Fed policy outlook. Also, investors will react to the GDP growth which propelled to 7.8% in QFY24, however, broadly below expectations. In the early hours, Gift Nifty also traded in the red. In the previous session, Sensex and Nifty 50 settled in red with Adani Group-backed shares nosediving after new findings from George Soros-backed OCCRP on the port-to-power empire.

Apart from global trends, GDP growth data, auto monthly sales and metal production data will also influence market mood.

Gift Nifty, formerly known as SGX Nifty, traded at 19,413.5, down by 15.5 points or 0.08% at 6.59 a.m. on Friday. The index opened at 19,429 and traded in the range of intraday high and low of 19,429 to 19,391.5 respectively.

In the early trade, Asian stocks traded mixed tracking the somewhat muted performance of Wall Street overnight. Japan's Nikkei 225 jumped 167.55 points, and South Korea's KOSPI index inched up by 0.2%, however, Australia's ASX 200 dipped by 0.4%.

Notably, the Hong Kong share market is closed as the city is expected to witness its strongest storm in at least five years.

According to Bloomberg, investors will be monitoring shares of Chinese banks and property developers following moves by the government to allow the nation's largest cities to cut down payments for home buyers and encourage lenders to lower rates on existing mortgages as well as on deposits. Bank of China Ltd. followed through by lowering deposit rates on Friday.

Further, US stocks were broadly lower on Friday and settled the overall August month on a bearish note. Overnight, the Dow Jones Industrial Average dropped by 168.33 points, and the S&P 500 index inched lower by 0.16%. However, the tech-heavy Nasdaq Composite outperformed its counterparts, but with marginal gains of 0.11%.

At home, Sensex ended at 64,831.41, down by 255.84 points or 0.39%, while Nifty 50 dipped by 93.65 points or 0.48% to end at 19,253.80 on Friday. Bank Nifty shed 243.45 points. Also, the BSE Smallcap index outperformed the broader indices with a surge of 292.53 points, meanwhile, the Midcap index tumbled marginally by 7.27 points respectively. Banking, FMCG and oil & gas stocks were top bears, on the contrary, capital goods and consumer durables were top gainers.

Friday's Trade Guide:

Vaishali Parekh, Vice President - Technical Research, Prabhudas Lilladher expects the Nifty Spot Index to find support around 19,100/19,050 during Friday's trade, while resistance is seen at 19,400/19,450. Further, the Bank Nifty spot index is likely to find support in the range of 43,700/43,650 and resistance is seen between 44,400/44,450.

Intraday Stock Picks:

Parekh has recommended 3 stocks to buy on Friday:

- Buy Raymond at Rs 1,999 with a stop loss of Rs 1,975 for a target of Rs 2,120.

- Buy Sona Blw Precision Forgings at Rs 595.60 with a stop loss of Rs 587 for a target of Rs 627.

- Buy Midhani at Rs 410.55 with a stop loss of Rs 403 for a target of Rs 435.

Also, Ajit Mishra, SVP - Technical Research, Religare Broking said, "We are seeing a gradual fall in the index amid mixed global cues however buoyancy on the broader front combined with selective buying across sectors is compensating in the interim. Participants should continue with the stock-specific approach until we see a decisive sign of reversal in the index. Besides, keep a close watch on the global front for further cues."

On the Nifty 50 index, Rupak De, Senior Technical analyst at LKP Securities said that the Nifty faced persistent resistance at the 21-day Exponential Moving Average (21EMA), which resulted in a market correction. Two consecutive unsuccessful attempts to surpass the critical 21EMA level led to an increase in selling pressure. The overall sentiment remains pessimistic, with the likelihood of any upward rallies being met with selling activity. On the downside, the initial support level is placed at 19,200. If the index falls below the 19,200 level, it could potentially move towards the 19,000 mark. The sell-on-rise strategy is expected to favour the traders until the Nifty convincingly surpasses the 19,500 level.

Further, on Bank Nifty, Kunal Shah, Senior Technical & Derivative analyst at LKP Securities said that during the last day of August expiry, the BankNifty index faced persistent selling pressure from the bears, ultimately leading to a negative close of 0.35% for the day. The upcoming sessions are crucial for the Bulls as they aim to defend the critical support zone of 44000-43800. Failure to hold this support level could trigger additional declines, potentially pushing the index towards the 43000 mark. On the upside, the immediate obstacle for the index lies at 44200. If the index manages to breach this level, it could set the stage for further upward movement towards the 44500 level.

Disclaimer:

The recommendations made above are by market analysts and are not advised by either the author or Greynium Information Technologies. The author, the brokerage firm nor Greynium would be liable for any losses caused as a result of decisions based on this write-up. Goodreturns.in advises users to consult with certified experts before making any investment decision.