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Brace for massive volatility on judgement day: Analysts
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IANS | 22 May, 2019
Greed and fear will keep investors on tenterhooks during the next couple of days as they await clarity on the next government.
"Counting
will start by 7 a.m. and by the time the markets open, there would
already be a buzz around who is leading. This is largely going to
dictate in which direction the markets will open," said Amit Gupta,
Co-Founder and CEO, TradingBells.
"If the NDA is leading, markets
might see a 'gap-up' opening (sharp upward movement in little or no
trading time) and if UPA is leading, it might just be the opposite."
With
monthly futures contracts are also nearing their end and investors
entering into new contracts, there is usually a period of volatility
that results in markets seeing a fall.
Gupta claimed that Nifty
will cross 12,000 if the NDA manages to secure a majority. "However if
this doesn't happen and there is a hung Parliament, or UPA comes to
power, we can expect to see a huge correction in the markets over the
next couple of days.
"In such a scenario, if Nifty breaches its
last week's low of 11,050 which also happens to be its current 200 DMA,
then we can see further downside movement up to 10,450 where we see the
next support," he added.
Analysts have further predicted a huge
correction, probably of a higher magnitude, than the one seen on Monday,
when the euphoria of exit polls showing a return of Prime Minister
Narendra Modi gripped the markets.
Nifty forms a spinning candle
on the daily chart after two volatile sessions, which shows outright
confusion just ahead of the counting. Stocks like Reliance, Tata Steel,
HDFC, and Infosys remained muted ahead of counting day, said Mustafa
Nadeem, CEO, Epic Research.
SGX currently displays 48 points
lower compared to the Nifty Futures close on Wednesday at 8.40 p.m.
Singapore time. "This probably reflects the impact of institutional data
for Wednesday released sometime back whereby both FPIs and locals were
net sellers on Wednesday," said Deepak Jasani of HDFC Securities.
Positive
trends on SGX Nifty, a futures instrument traded in the Singapore Stock
Exchange, indicate a strong opening for the benchmark indices in India
and vice versa.
"Even European markets softened a bit post
Indian market closing. Going by this and assuming that not much will
change despite US markets trading between now and tomorrow morning,
Nifty futures could open a bit soft tomorrow," Jasani said.
Beside,
he added that the SGX Nifty is traded between 6.30 a.m. and 11 p.m.
Indian time and hence will keep reacting to various developments and
that the markets could remain volatile on Thursday awaiting results
which could take time, given the higher proportion of VVPAT votes to be
manually counted.
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Customs Exchange Rates |
Currency |
Import |
Export |
US Dollar
|
66.20
|
64.50 |
UK Pound
|
87.50
|
84.65 |
Euro
|
78.25
|
75.65 |
Japanese
Yen |
58.85 |
56.85 |
As on 13 Aug, 2022 |
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