Chart Busters: Top trading set-ups to watch out for on Friday.

Chart Busters: Top trading set-ups to watch out for on Friday.
by 5paisa Research Team 08/10/2021

On the weekly expiry day, the benchmark index Nifty was traded in a narrow range of 94 points, which is the lowest trading range in the last 9 trading sessions. The broader market has outperformed benchmark indices on Thursday. The Nifty Midcap 100 index has marked a fresh all time high of 31365.65 level. The advance-decline ratio was in the favour of advancers.

Here are the top trading set-ups to watch out for Friday.

Mishra Dhatu Nigam: Considering the weekly chart, the stock is oscillating in the range of Rs 237-Rs 172.80 level. The zone of Rs 172.80-Rs 176 is acting as a strong support zone for the stock. The stock has taken support in the same zone three times. Recently, the stock has formed Doji candle near the support zone on the weekly chart and thereafter witnessed higher bottom. On Thursday, the stock has given a breakout of a downward sloping trendline resistance on the daily chart. This breakout was confirmed by robust volume. Along with this breakout, the stock has surged above its crucial 200-Day EMA level, which is a bullish sign. The short-term moving averages, i.e. 13-day EMA and 20-day EMA is in a rising trajectory. The leading indicator, 14-period daily RSI has surged above the 60 mark for the first time after 74 trading sessions. The RSI is in rising mode and it is trading above its 9-day average. The momentum indicator MACD line has crossed above the signal line, which resulted in the histogram turning positive. Hence, we would advise the traders to be with a bullish bias. On the downside, the zone of Rs 189-Rs 186 is likely to act as crucial support for the stock. While on the upside, the level of Rs 206, followed by Rs 216 level may act as immediate resistance for the stock.

Shankara Building Products: After registering the high of Rs 648.80, the stock has witnessed minor correction along with low volume. The correction is halted near the 20-day EMA level. The stock has formed a strong base near the 20-day EMA level and on Thursday, it has given five days consolidation breakout on the daily chart. This breakout was supported by above 50-days average volume. Currently, the stock is trading above its short and long-term moving averages. These averages are in a rising trajectory, which is a bullish sign. A daily momentum indicator RSI reading is above 60 level with a positive crossover which points out a positive breath in the stock. The MACD stays bullish as it is trading above its zero line and signal line. On the daily timeframe, ADX is above 22 level, which suggests that the trend is yet to be developed. Directional indicators continue in the ‘buy’ mode as +DI continues above –DI. Based on the above observations, we expect the stock to continue its upward movement and test levels of Rs 650 followed by Rs 684 in the short term. On the downside, the 20-day EMA is likely to act as crucial support for the stock, which is currently quoting at Rs 586 level.

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Here’s what you need to know before the market opens on October 08, 2021.

Opening Bell: Here’s what you need to know before the market opens on October 08, 2021.
by 5paisa Research Team 08/10/2021

Bulls are likely to continue their positive move, RBI policy outcome could dictate the near term trend of markets along with the outcome of TCS earnings.

On Friday morning, the SGX Nifty is indicating that there is no stopping the stock markets bulls and they are likely to continue the jubilant form and pick up from where they left in the last trading session. SGX Nifty is trading up by 36 points and was seen trading at levels of 17,851.50 mark.

Cues from Asian markets: It’s a sea of green for Asian equities on Friday following a strong close on Wall Street in overnight trade. Japan’s Nikkei 225 has jumped more than 2%, while Hong Kong’s Hang Seng has added 0.14% and China’s Composite has advanced 0.49%.  

Overnight cues from US markets: On Wall Street stocks continued to move northward on Thursday after lawmakers reached an agreement to temporarily extend the debt limit, which resulted in avoiding a potential default. Tech-heavy Nasdaq led from the front as it surged up 1.1%, while the Dow and the S&P 500 gained 1% and 0.8%, respectively.

Last session summary: On Thursday, Indian benchmark indices ended the trading session firmly in positive terrain as Nifty and Sensex rose by 0.82%, each. The broader markets outperformed the frontline indices as Nifty Midcap 100 and Smallcap 100 jumped by 1.88% and 1.22%, respectively.

Among the sectoral indices, barring Nifty Energy, all other sectoral indices ended in green with Nifty Realty and Nifty Auto advancing 6.16% and 4.39%, respectively.

FII’s and DII’s activity on Thursday: DIIs were net buyers to the tune of Rs 2,528.64 crore, while on other hand, FIIs were net sellers to the tune of Rs 1,764.25 crore.

Important events to watch out for: The biggest event for the day is the RBI policy outcome. The monetary policy committee is expected to maintain its accommodative stance to maintain adequate liquidity in the system and support economic activity. In addition to this, market participants will keenly watch the Q2 earnings with IT bellwether TCS to set afire the ceremonial starters’ pistol for Q2 earning season post-market.

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Explained: Why is India facing coal crisis and why it’s critical to resolve it

by 5paisa Research Team 08/10/2021

For some years now, India has not faced a coal shortage. In fact, the Narendra Modi government has often cited this as an achievement, in contrast to the days of the previous Manmohan Singh-led United Progressive Alliance regime, during whose era, India faced huge coal shortages and power supply cuts. 

But things could again be changing, for the worse.

India is facing a near-crippling coal shortage and the problem could last for at least as long as the next six months. 

Why is India facing this coal shortage?

For one, August and September this year were unusually rainy months in India. Heavy rains impacted coal production and delivery in mining districts across the coal belt in states like Jharkhand, Orissa and Chhattisgarh. Moreover, plants could not ramp up capacity to pre-monsoon levels. 

On top of that as India began revving up its Covid-ravaged economy, demand outstripped supply, with 124 billion units of electricity produced in August as compared to 106 billion units in August 2019, according to a report by The Indian Express

Moreover, India’s coal imports fell during this period, as international prices rose. The price of Indonesian coal went up more than three times from $60 per tonne to $200 per tonne between March and September.  

How important is coal in India’s energy mix?

Cheap coal is the dominant fuel that fires up India’s economy. Almost 70% of India’s electricity needs are met by coal-fired plants. 

As of the beginning of this month, the 135 coal-based power plants in the country had an average of just four days of coal stocks left. 

What has the government said? What is it doing about it?

Power minister RK Singh has said that the situation is “touch and go” and has asked state-run coal miner Coal India as well power producer NTPC Ltd to raise output from their mines. 

The government is also trying to bring more mines on stream, The Indian Express report said. 

Despite costlier imported coal, India will have to go in for more imports, to meet domestic demand for power. 

If the shortage continues, what could be the impact on the economy?

For one, it could delay the reopening of the economy, which has been trying to get back on its feet following the debilitating lockdowns of 2020 that plunged it into a recession and left millions jobless. 

Not only will some businesses have to downscale production, prices of downstream commodities like steel could see a significant rise. In fact, VR Sharma, managing director at steelmaker Jindal Steel and Power Ltd, has said as much. A tonne of coal, which was in the range of Rs 4,000-6,000 a tonne, is now costing Rs 8,000-Rs 12,000 a tonne, Sharma told PTI in a telephonic interaction.

“Steel in India at present is in the range of Rs 50,000-55,000 a tonne. Shortage of coal has led to an increase in its prices that will have an impact on steel, which may also go up due to this unprecedented rise," he said.

India consumes 1,200 million tonnes of thermal coal or steam coal per year.

However, state-owned Coal India produces 800 million tonnes annually, a shortfall of 400 million tonnes. Of this, the domestic steel industry alone consumes 150 million tonnes of coal per year

Sharma thinks that the crisis can be managed if Coal India increased its production. The company must produce 100 million coal per month to meet the annual demand that comes from various industries like power, steel, aluminium and copper.

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RBI keeps interest rates on hold. 10 things you need to know

by 5paisa Research Team 08/10/2021

The Reserve Bank of India (RBI) on Friday kept the benchmark repo rate unchanged, even as it lowered its forecast for consumer price inflation and retained India’s gross domestic product (GDP) growth target at 9.5%.

Here are 10 important things that the central bank said in its latest bi-monthly monetary policy.

1) The Monetary Policy Committee (MPC) has kept the repo rate at 4%, for the eighth straight time. The reverse repo rate will continue to be at 3.35%.

2) The MPC has maintained an “accommodative” stance as far as its outlook goes.

3) Since March 2020, the month India went into a nationwide lockdown to control the spread of Covid-19, the repo rate has been brought down by 115 basis points. Since 2019, the rate is down 135 basis points. 

4) Food inflation is likely to remain muted, the central bank’s governor Shaktikanta Das said.

5) Real GDP growth for the first quarter of FY2022-23 is pegged at 17.2%.

6) RBI retained gross domestic product (GDP) growth target at 9.5% for FY2021-22.

7) RBI lowered CPI inflation projections to 5.3% for this fiscal year from the earlier estimate of 5.7%.

8) The RBI wants a framework for retail digital payments in offline mode to be instituted. It also wants a framework on geotagging technology on all payment infrastructure, existing or new.

9) RBI said a new internal Ombudsman Scheme for addressing grievances of customers of non-banking finance companies will be set up.

10) Transaction limit for Immediate Payments Service (IMPS) has been hiked to Rs 5 lakh from Rs 2 lakh. 

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These Penny Stocks are locked in the Upper Circuit on Friday.

These Penny Stocks are locked in the Upper Circuit on Friday.
by 5paisa Research Team 08/10/2021

Penny stocks reflect the market sentiment to an extent. When you have a broad-based outperformance in penny stocks, you can say that a risk-on rally is happening in the markets.

The Sensex is trading with gains above 400 points and is comfortably sustaining above the crucial 60000 levels.

The IT stocks are catching investors’ attention on Friday with Mindtree and Persistent Systems gaining by more than 5% each on an intraday basis. IT bellwether Infosys and TCS feature amongst the top Sensex gainers on Friday.

BSE IT index is the top sectoral gainer followed by the BSE Metal index. The metal index is supported by Tata Steel, after gaining more than 2%, and is also the top Sensex gainer.

The broader markets however are seen underperforming the frontline indices on Friday.

The market is also cheering the announcement by the RBI where the rates have been kept unchanged. A favourable than anticipated inflation trajectory and downward revision of CPI at 5.30% has allayed any fears of near-term rate hikes. The Governor has assured the markets of ample liquidity while announcing higher VRRRs to absorb the excessive systemic liquidity. The market expected the accommodative stance to continue by the RBI.

With positive sentiment in the market, further supported by the RBI announcement, several penny stocks are outperforming the market on Friday. Few of the trending penny stocks are seen locked in the upper circuit.

Here is the list of penny stocks that are locked in the upper circuit in Friday's trading session:

Sr No   

Stock Name   

LTP   

Price Gain (%)  

1  

JD Power   

5.2  

19.54  

2  

SITI Networks   

2.4  

4.35  

3  

FCS Software   

1.4  

3.7  

4  

Orient Green Power   

4.1  

9.33  

5  

JP Associates   

9.45  

5  

6  

Lloyd Steels  

4.1  

3.8  

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5 Stocks to Buy Today: October 8, 2021

5 Stocks to Buy Today: October 8, 2021
by 5paisa Research Team 08/10/2021

Every morning our analysts scan through the markets universe and chose the best momentum stocks to buy today. The stocks are recommended from a wider list of momentum stocks and only the best ones make it to the top 5 list. We also update on the performance of earlier recommendation every morning to help you with your trading journey. Read on to know the momentum stocks to buy today. The average holding period could be between 7-10 days on average.

List of 5 Stocks to Buy Today October 8

1. Godrej Properties (GODREJPROP)

Godrej Properties Stock Details for Today

- Current Market Price: Rs. 2,477

- Stop Loss: Rs. 2,420

- Target 1: Rs. 2,540

- Target 2: Rs. 2,625

- Holding Period: One week

5paisa Recommendation: Our technical experts see end in sideways move of the stock hence making this stock best stock to buy.

 

2. Apcotex Industries (APCOTEXIND)

Apcotex Industries Stock Details for Today: 

- Current Market Price: Rs. 446

- Stop Loss: Rs. 435

- Target 1: Rs. 459

- Target 2: Rs. 475

- Holding Period: 1 week

5paisa Recommendation: Our technical experts expects further buying in the stock and recommends buying this stock.

 

3. Tata Motors (TATAMOTORS)

Tata Motors Stock Details for Today: 

- Current Market Price: Rs. 377

- Stop Loss: Rs. 368

- Target 1: Rs. 387

- Target 2: Rs. 405

- Holding Period: 1 week

5paisa Recommendation: Positive momentum in stock is expected and thus making this stock as one of the best stocks to buy today.

 

4. Multi Commodity (MCX)

Multi Commodity Stock Details for Today: 

- Current Market Price: Rs. 1,820

- Stop Loss: Rs. 1,770

- Target 1: Rs. 1,874

- Target 2: Rs. 1,936

- Holding Period: 1 week

5paisa Recommendation: Positive momentum in stock is expected and thus making this stock as one of the best stocks to buy today.

 

5. Sobha Ltd (SOBHA)

Sobha Ltd Stock Details for Today: 

- Current Market Price: Rs. 885

- Stop Loss: Rs. 863

- Target 1: Rs. 905

- Target 1: Rs. 934

- Holding Period: 1 week

5paisa Recommendation: Our technical experts see strong volume in this stock hence making this stock best stock to buy.

 

Share Market Today

SGX NIFTY: 

SGX Nifty indicates positive opening for Indian markets. SGX Nifty is at 17,850.20 levels, higher 239.20 points. (Updated at 7:50 AM).

International Markets:

US Market: US markets rise as debt ceiling gets passed by Capital hill which sees stocks move higher.

Dow Jones closed up 340 points while Nasdaq ends with gains of 150 points.

Bond yields rise in tandem to 6-month highs at 1.58 while the US $ index also closed unchanged at 94.23.

Asian Market: Asian markets opened in the green led by the Japanese ‘Nikkei’ which was higher by over 550 points in early trade as bulls called the shots in most Asian markets over the last 2 days.

Chinese stocks will open today after the long holidays and could see effects of 'Evergrande' defaults play out on banks while excellent global cues mitigate the weakness.

Disclaimer: The above report is compiled from information available on the public platforms.