Experts predict weakness in Nifty, Bank Nifty

On account of dip in SGX Nifty and rising Covid-19 concern, experts have predicted range-bound trend with negative outlook when the Indian stock market opens today. They said that major trigger for Dalal Street is the number of new Covid-19 cases getting reported these days. Since there is no relief coming on the Covid front and the US markets have also ended in red zone yesterday, market is expected to trade in 14,150 to 14,500 range. They advised investors to continue trade specific strategy focusing on pharma, IT and FMCG stocks.

Speaking on the expected market trend today Avinash Gorakshkar, Head of Research at Prifitmart Securities said, "Market is expected to remain weak as there is still no relief coming on the second wave of Covid-19 fears. In global markets too, US markets have shown weakness yesterday that will further spoil the Bull's spirit. I would advise market traders and investors to maintain sell on rise strategy with stock specific trade."

Gorakshkar said that one should continue focus on pharma, IT and FMCG stocks and advised investors to look at Aurobindo Pharma, Gland Pharma and Pfizer stocks as potential shares to buy today. He said that yesterday's rise in the Indian indices was mainly due to the short-covering done by the traders in the wake of weekend Future & Option (F&O) expiry.

Standing in sync with Avinash Gorakshkar's views; Nagaraj Shetti, Technical Research Analyst at HDFC Securities said, "The intraday chart pattern of the last four sessions signal a formation of descending type triangle pattern (consistent lower highs and repeated hitting of lower support). This pattern could indicate chances of another sell on rise in the next few sessions and the revisit of lower support at 14,150 to 14,200 levels again in the near term."

Shetti went on to add that the fear of sharp sell on rise is still persisting until 14,560 levels is surpassed decisively on the upside. The intraday chart setup could signal a possibility of another sell on rise around 14,450 to 14,500 levels in the next 1-2 sessions.

Despite positive opening, SGX Nifty failed to sustain the opening bell gains and finally slipped in the red zone. Currently, SGX Nifty is down 84 points at 14,321 levels (8:12 AM IST).

At Wall Street yesterday, Dow Jones dipped 0.94 per cent and closed at 33,815.90 levels, Nasdaq too went down 0.94 per cent after closing at 13,818.41 mark while Small Cap 2000 nudged 0.01 per cent up and closed at 2,239.93.

Among major Asian indices, Japanese Nikkei is down 0.67 per cent, Hang Seng is up by 1 per cent while Shanghai market has added 0.30 per cent in their respective opening bells today.