Volatility To Continue? Pre Market Analysis

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

Stocks

Aviation major IndiGo on Friday reported a multi-fold surge in net profit to Rs 1,422 crore for the three months ended December. The profit rose over 1,000%, compared with Rs 129 crore in the last-year period. Revenue from operations surged 61% to Rs 14,932 crore in the third quarter.

Paytm has turned positive a the EBITDA level in the December quarter, three quarters ahead of its guidance. The company posted a consolidated net loss of Rs 392 crore for the quarter ended December. The net loss has narrowed from Rs 779 crore a year ago.

Tata Steel is expected to report a muted set of earnings for the third quarter of the current financial year. The company's profit after tax (PAT) more than halved to Rs 4,300 crore in the December quarter.

ITC reported a 21% year-on-year (YoY) rise in net profit for the quarter ended December to Rs 5,031 crore.

Consumer durables firm Marico reported a 6% year-on-year (YoY) increase in its consolidated profit after tax to Rs 328 crore for the quarter ended December 31, 2022.

What to Expect Today?

NIFTY opened with a gap-up at 17,722 on Friday. The index took support at 17,580 and moved up. A heavy rally followed and NIFTY closed at 17,854, up by 244 points or 1.38%.

BANK NIFTY opened with a gap-up at 41,082. The index moved down in the first half and the range was wide. BNF rallied in the second half and closed at 41,499, up by 830 points or 2.04%.

IT closed flat.

The US markets fell on Friday. The  European markets moved higher except for DAX.

The Asian markets are trading deep in the red except for NIKKEI.

The U.S. Futures and European futures are trading lower.

SGX NIFTY is trading at 17,820 indicating a flat to gap-down opening.

NIFTY has supports at 17,680, 17,600 and 17,540. We can expect resistances at 17,970, 18,000 and 18,100.

BANK NIFTY has supports at 40,850, 40,700 and 40,340. Resistances are at 42,000, 42,500 and 42,770.

FIN NIFTY has supports at 18200, 18,110 and 18,030. Resistances are at 18,500, 18,660 and 18,800.

NIFTY has the highest call OI build-up at 18,000. The highest put OI build-up is at 17,600.

BANK NIFTY has the highest call OI build-up at 43,000. The highest put OI build-up is at 40,500.

FINNIFTY has the highest call OI build-up at 19,000. The highest put OI build-up is at 17,800.

INDIA VIX dropped by 8% to 14.4.

Foreign Institutional Investors net-sold shares worth Rs 900 crores. Domestic Institutional Investors net-bought shares worth 1,300 crores.

That was an extremely volatile week. It was event-packed with corporate results, Auto Sales data, Fed interest rate decision and more importantly, the Union Budget. To add to it, the US Jobs data surprised with a huge job addition amid recession.

Unemployment is now at the lowest level since 1969 in the US. The job addition magnitude is the largest in six months. This tighter market will make it harder for the Fed.

Though VIX has dropped after the events, we cannot be sure if volatility has come to an end looking at the structure of the chart. 

ITC and SBI results were better than expectations. Keep an eye on the stocks, especially SBI.

As we discussed yesterday, the market looks rather uncertain due to the Adani issue. It is hard to form a view on the market since there is extreme volatility and the move is news-dependent. Still, crossing 18K will be a reversal sign.

I will watch 17,600 on the downside in NIFTY. 18,000 can be watched on the upside.

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