# The Numbers are in and the verdict is out…

*Morning Action @ 7 AM – Thursday, September 19th 2024*

# As of writing, Gift Nifty, Dow futures and Asian stock markets are comfortably in the green as investors react and assess the Federal Reserve’s decision to cut rates by 50 basis points, an aggressive start to its easing campaign and the first-rate reduction in four years.

*7:00 AM GLOBAL UPDATE:*
# GIFT Nifty 🇮🇳: (+7, 25407)
# Dow Futures: (+67, 41570)
# Nasdaq 100 Futures (+128, 19472)

# Nikkei (+810, 37190)
# Hang Seng (-26, 17634)

# Dow Jones (-103, 41503)
# Nasdaq (-55, 17573)
# Bovespa (-1134, 133826).

MARKET TRENDS:
# Global: Positive
# FII: Positive (+1153.69 Cr)
# DII: Positive (+152.31 Cr)
# Sentiment: Risky
# Market Breadth: Neutral
# Technicals: Overbought conditions
# F&O: 24500 – 26000 zone.

# INDIA VIX 13.37 (+6.22%)
# Nifty PCR (26th Sept) 1.44
# Bank Nifty PCR (25th Sept) 1.01

# Nifty Outlook: Volatility is likely to be the hallmark.

# WHAT TECHNICALS TELLS US ON NIFTY & BANK NIFTY:

Nifty Technically:
Nifty (CMP: 25378)
SUPPORT: 25171/25000
RESISTANCE: 25551/26000
RANGE: 25250-25550
BIAS: Positive
21 DMA: 25117
50 DMA: 24757
200 DMA: 22863

Bank Nifty Technically:
BANK NIFTY (CMP 52750):
SUPPORT: 52100/51500
RESISTANCE: 53359/54100
RANGE: 52400-53400
BIAS: Positive
21 DMA: 51403
50 DMA: 51317
200 DMA: 48781

 

*WHAT EXACTLY HAPPENED AT WALL STREET IN OVERNIGHT TRADE:*

# The Numbers are in and the verdict is out…

# The Numbers: As widely expected, the Federal Reserve lowered its benchmark interest rate by 50bps to 4.75%-5% in light of the progress on inflation and the balance of risks. It is the first rate cut in 4-years.

Additionally, projections by FOMC members pointed to a median of 100bps in total rate cuts for the year, translating to 25bps in each of the central bank’s meetings this year.

Importantly, policymakers also expect GDP growth to remain at the 2% level for the upcoming years.

# The Verdict: Despite Wall Street receiving a jumbo 50bps rate cut, US stocks markets traded volatile.

Blame it on Powell’s statement that the Fed may dial back pace of cuts, if the US economy remains solid.

# WTI Crude oil trades firm at the $70.03 per barrel.

# COMEX Gold consolidates at $2555 per ounce.

NEED TO KNOW:

# The Good News: The Fed Reserve’s first rate cut in four years was a big one.

Most importantly, there are more rate cuts to come.

# The Federal Reserve lowered its benchmark interest rate by 50bps to 4.75%-5% in light of the progress on inflation and the balance of risks. It was the first rate cut in 4-years.

# Additionally, projections by FOMC members pointed to a median of 100bps in total rate cuts for the year, translating to 25bps in each of the central bank’s meetings this year.

# Importantly, policymakers also expect GDP growth to remain at the 2% level for the upcoming years.

# Upside risks to inflation have diminished…

# Long story short: Nifty could trade volatile on any intraday spike as the Federal Reserve has said that they may dial back pace of cuts, if the US economy remains solid.

# Buzzing stocks:

1) In yesterday’s trade, IT stocks like INFY, TCS, MPHASIS, PERSISTENT and LTTS dropped between 3-6% amidst massive profit booking.

Nifty IT Index tumbled 3%.

Losses in IT sector’s stocks were also on backdrop of Accenture’s 5% drop on news that Accenture Plc is planning to push back the bulk of its staff promotions by six months due to a challenging consultancy environment.

2) ICICI Bank scaled fresh all-time-high at Rs 1295 and most importantly, mcap hits Rs 9 lakh crore milestone for first time.

ICICI Bank Ltd became the fourth Indian firm to cross market capitalisation of Rs 9 lakh crore.

3) Bajaj Housing Finance shares dropped 4.66% lower in yesterday’s trade amidst profit booking after its bumper debut in Monday’s trade.

Bajaj Housing Finance ended at Rs 173, has surged 155% above the IPO issue price of Rs 70.

The m-cap of the Bajaj Housing Finance now around 1.5 lakh crore.

# Now, here is the preferred trade on Nifty and Bank Nifty:

Nifty (25377): Buy between 25300-25350 zone. Stop at 24751. Zone. Targets 25500/25701. Aggressive targets at 25900-26100 zone.

Bank Nifty (52750): Buy between 52300-52600 zone. Stop at 51301. Targets 53359/53750. Aggressive targets at 54300-55000 zone.

# The 1 Stock to Sell Right Now:

Sell IRCTC (CMP 906): Sell between 911-915 zone. Stop at 937. Targets 887/845. Aggressive targets at 801. (Interweek Strategy). Rationale: Momentum oscillators turning bearish. Signaling a massive downside breakdown.

*Disclaimer:* This does not construe to be an investment advice. Stock market investments are subject to market risks. All information is a point of view, and is for educational and informational use only. The author accepts no liability for any interpretation of articles or comments on this platform being used for actual investments. Registration granted by SEBI and certification from NISM in no way guarantee performance of the intermediary or provide any assurance of returns to investors.

 

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