Saturday 6 July 2019

Market Update for 8th July 2019 by Imtiaz Merchant



The event budget failed to enthuse the market, as a result market fell sharply by almost 1.25% in terms of index, but the fall outside the index was catastrophic and stock fell by 2 – 8%. The internals of the markets were extremely poor, and all this happened with higher volumes. The budget failed in policy regarding growth. Government going forward looking to borrow big time from overseas and this according to us is not a good sign, however some long term rationalisation majors were taken that could prove good in the long term, the very rich now will be taxed higher and the middle class by virtue of exemption limit of 5 lakh will get some relief. More thrust was given on encouraging of electric vehicles and lot of incentives was given in manufacturing the same. Higher excise duty on petroleum products and rising custom duty on gold will be look upon negatively. Although markets failed badly on Friday but still remained within a range between 11600 and 12000. It has to be seen how the market will behave on Monday and Tuesday and further course of action will be decided thereon.    

Technical– Technically markets in terms of Nifty looks vulnerable to more fall, trade in close below 11725 will bring down the market to 11625. As long as markets are above 11600 there is still a hope of bulls to stage a comeback, however close 11600 would see a extended fall or protracted corrective action and market could test perhaps 11100 – 11000. Since the market is crucially poised reversal cannot be totally ruled out, if the experts after looking to the blue prints of Union Budget and World markets cues  feels that budget may boost the economy that in terms of levels market may test 12000 initially and a close above this levels it could test 12400 – 12800 levels.


No comments:

Post a Comment