Quarterly numbers will affect Indian equities in upcoming sessions : Epic Research

Mr. Mustafa Nadeem, CEO, Epic Research

Markets continue to move lower as volatility rises and global markets slump as the US ignites the trade war. The markets took its cues from the global sentiments and indices across the US and Europe that were trading at new lows of 2018. The overall global market was eyeing the FED Rate decision which was as expected at 1.75% triggering the second round of selling. The Global markets were down by almost 3-5% while European markets also tumbled to new lows. Asian equity markets were further in pressure with prices seeing a cut of 3-5%.

Benchmark Indian Nifty closed down for a fourth consecutive week as bears grip on the secondary trend remained strong amid negative cues mounting. Bank Nifty too was on the downswing for a consecutive eighth week to close below important support at 24K. As they remain below important 200 Days SMA the view continues to be bearish with minor pullbacks.

Technically We have been in bearish trend and it may continue to remain that way. Any pullback will be seen as an opportunity for a sell on rising strategy. The simple logic would be the prices are below long-term averages and the Volatility is on the rise. A sustained move with consecutive closing below important 100 and 200 MA and now short term MA like 20 and 50 proving to be immediate resistance on the upside. The weakness in the banking sector and metals space is further dragging the market down. Major heavyweight indices like Banking, Automobile, and Metals are seeing selling pressure. The important point to look here is that we are seeing selling pressure in the defensive sector like Pharma and FMCG. Though IT sector is up as present scenario favors it well along with fresh breakout.

Fundamentally, The round of cues that will affect Indian equities will be the quarterly numbers that will be coming. Since Quarterly and Annual numbers will be reported it will be stock specific along with the rotation of portfolio to sectors adjusting to their earnings. Apart from that, we will be having our usual IIP and WPI data coming along in mid and last of April. Monsoon will further act as a trigger for next 1-year view on domestic markets.

Investors looking to enter in the market especially for long-term should look at accumulating blue-chips in Tranche while technically in short-term we see demand that may attract big flow will be around 9600 - 9550 which is the crucial support for bulls. In the intermediate term, we will be waiting for a pullback to further see downside move.

Source : Equity Bulls

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