HDFC & HDFC Bank Fire on all Cylinders as Nifty Ends Above 18000


HDFC (NS:) & HDFC Bank (NS:) Fire on All Cylinders As Ends Above 18000

O 17809.10

H 18114.65

L 17791.40

C 18053.40/+382.95/+2.17%

BANK NIFTY EOD 38635.20/+1486.70/+4.00%

SGX NIFTY at 1820h +33

18.44/-10.44%

FII DII data +2,827 Crores

NIFTY TOP 5 CONTRIBUTORS

Leaders 270

Laggards 162

Net 108

BANK NIFTY TOP 3 CONTRIBUTORS [Please read Insight #10]

Leaders 297

Laggards 003

Net 294

CHART BASED DETAILS ARE AVAILABLE IN THE FOLLOWING VIDEO:

https://youtu.be/nCSoRPXGg30

POSITIVES

HDFC twins have performed possibly beyond expectations. ICICI Bank (NS:) & Kotak Bank have also performed well today.

Reliance (NS:) held on to the positive territory.
FIIs and DIIs ended the day as Net Buyers in excess of 1,000 Crores each.

India Vix closed below 18.

NEGATIVES

Infosys (NS:) continues to shy away from turning positive.

INDEX SUPPORT & RESISTANCE LEVELS
Please read Insight #11

TRADING INSIGHTS & OBSERVATIONS

  1. Today was something all traders/investors are unlikely to forget and me in particular. The reason is very simple – I have never seen the kind of positivity that the HDFC twins showed today on account of HDFC Bank getting merged with HDFC. The news was a developing story as the market opened and soon the heavyweights were all over the market.
  2. It was good that HDFC Bank is part of otherwise Bank Nifty would have been massively outperformed by Nifty alone. On an EOD basis, Bank Nifty was up 4% which is an insane move considering the fact that the rest of the global markets were subdued. Nifty was held by many of its constituents at 2.17% which is still a great rise.
  3. Today there is nothing specific to write except for the HDFC twins and Kotak Bank which was up 3%+ as the rest of the heavyweights were lagging behind in the race.
  4. Nifty opened with a gap up of 100+ plus points and as the HDFC twins kept going up, Nifty, as well as Bank Nifty, kept moving up in the first hour. By that time, both the indices had registered the day’s high which was attempted for a retest but could not be hit.
  5. Then came the gradual fall as traders/investors [like me] would have banked some gains as Nifty had crossed the 18000 mark after a long time. The fall from the high of 18114 to the low around 17900 was slow and lasted till 1300h.
  6. Thereafter, Nifty recommenced its journey up and ended the day well above 18000 which is a great comeback from the lows of 15671 experienced just a few weeks ago.
  7. Infosys appeared to be clearly disappointed with the news as it chose not to join the rally and instead ended the day in red. This along with Reliance are going to be the key shares to watch out in the remaining days of the week as these two would decide which way the market moves once the euphoria subsides from the HDFC twins’ merger.
  8. It is often said that – what goes around comes around. In my early corporate days, I used to frequent HDFC [there was no HDFC Bank back then] and now after a few decades, the circle would be completed as HDFC Bank would get merged with HDFC Ltd. I am no expert in fundamentals, but I am not sure how much HDFC shareholders would tend to benefit from this as the spare funds would now be applied to increasing the stake in HDFC Bank.
  9. Today, there is something strange in the moneycontrol data as HDFC Bank’s name does not feature in the top lifters of Bank Nifty. In fact, Kotak Mahindra Bank Ltd (NS:) appears as the topmost contributor. This is possibly indicating that the program for working out this list may have never imagined such a euphoric rise in HDFC Bank’s contribution.
  10. I do not think we can draw any conclusions based on today’s price action. As long as the Nifty is able to trade above 17900, the bullishness is likely to continue. If it can end the week above 17900 or higher, it would be heading to retest the All-Time High at 18604 – however, the close for the next 2 sessions is to be watched keenly.
  11. For the same reason, I have not placed any support or resistance range in this post as I am unable to form a view. Of course, I will be happy if the indices keep moving higher.

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This post is shared purely for Educational & Informational purposes only.



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