“Oil prices are observing some sell-off on Monday as Israel is holding off on a planned ground incursion of northern Gaza to negotiate a release of hostages, which opens a window for diplomacy. Oil prices has gained for two straight weeks on fear of potential supply disruption due to escalation of Israel-Gaza conflict, however we expect oil prices to ease further down as the global demand has seen some erosion in last few weeks due to growing uncertainty over the interest rates scenario in US, which has led to sharp surge in the UST yields, with 10 yrs benchmark yields around 5%, impacting the financial markets. WTI December futures retreats under $88 on Monday and we expect it to slide down to support of $85-$83 in coming sessions. There’s only a limited risk of future supply losses even if the fighting spreads beyond Israel and the Palestinian territories, it is unlikely to result in a prolonged oil spike. And the decision by U.S. to suspended sanctions on OPEC member Venezuela after a Venezuelan government deal with the opposition will also ease down global supply tightness. WTI December resistance at $90-$92 and Support remains around $85-$83, we advise traders to sell into rallies in the counter.”

– Mohammed Imran, Research Analyst at Sharekhan by BNP Paribas.

“USDINR CMP- 83.14 (spot) Indian Rupee gained on Friday on reports of selling of Dollars by the Reserve Bank of India (RBI) and softening of the US Dollar. We expect Rupee to trade with a slight negative bias as escalating tensions between Hamas and Israel may continue to deteriorate global risk sentiments. US Dollar may bounce back as safe haven demand may come into play and crude oil prices may rise further on concerns over supplies. US 10-year bond yields may are at fresh cyclical highs and is near the psychological resistance of 5% levels. However, any diplomatic efforts to contain the conflict in the Middle East and RBI intervention may support Rupee at lower levels. USDINR spot price is expected to trade in a range of Rs 82.80 to Rs 83.50,” said Anuj Choudhary – Research Analyst at Sharekhan by BNP Paribas.

(Source: NSE)

HDFC Bank, Kotak Mahindra Bank, ICICI Bank, Reliance Industries and Bajaj Finance are among the most active stocks on the NSE Nifty 50.

The Nifty Metal index tanked 3.08% during the intra-day trade on Monday. Network18 Media & Investments, Hathway Cable & Datacom and TV18 Broadcast plunged over 5% each.

ICRA Analytics announced that it has entered into a definitive agreement to acquire a majority stake in D2K Technologies India. “This acquisition will enhance ICRA’s ability to offer tech-backed solutions in risk assessment and analytics, which will play a significant role in shaping the progress of Indian lending and financial services markets,” the company said in a statement.

Vedanta may lose its third chief financial officer in as many years just as the mining conglomerate controlled by billionaire Anil Agarwal heads into an ambitious restructuring of its businesses, according to people familiar with the matter, reported Bloomberg.

(Source: NSE)

“WTI Crude oil futures ended the previous week marginally higher, as Iran-backed militant attacks on US army bases in Iraq and Syria coupled with escalation in tensions after the hospital blast in Gaza raised supply concerns. Meanwhile, US said they will ease sanctions on Venezuela’s oil exports in exchange for steps to ensure the country holds fair presidential elections next year. EIA data showed crude inventories continue to decline, while output rose to a record high of 13.2 mbpd during the previous week. Oil prices edged lower on Monday as the imminent ground invasion on Gaza strip has been delayed amid diplomatic efforts to secure the release of more hostages, easing concerns,” said Ravindra Rao, CMT, EPAT, VP-Head Commodity Research, Kotak Securities.

“Nifty weekly contract has highest open interest at 20,000 for Calls and 19,000 for Puts while monthly contracts have highest open interest at 20,000 for Calls and 19,000 for Puts. Highest new OI addition was seen at 19,600 for Calls and 19,400 for Puts in weekly and at 19,600 for Calls and 19,400 for Puts in monthly contracts. FIIs decreased their future index long position holdings by 13.16%, decreased future index shorts by 0.51% and increase in index options by 25.41% in Call longs, 20.95% in Call short, 29.30% in Put longs and 25.36% in Put shorts,” said Anand James, Chief Market Strategist at Geojit Financial Services.

“Gold extended its parabolic rally Friday on the key central banks hinting at a pause in their rate hike spree and safe haven demand due to the ongoing middle East conflict. Situation in Middle East remains alarming. It has been reported that for the first time in this conflict, Israeli soldiers clashed with Hamas in Gaza. Occasional clashes with Hezbollah have been reported, too. Humanitarian aid being allowed through Egypt into Gaza can be taken as a tentative positive development. Elevated US yields and firm Dollar will continue to pose downside risk for gold. The ten-year US yields reached fresh 16-year high as the yields approached 5% before settling st 4.92% Friday. The yellow metal is likely to be volatile as bulls aim for $2000. Support for the metal is at $1965/$1945. Resistance is at $2000/$2025.”

– Praveen Singh – Associate VP, Fundamental Currencies and Commodities, Sharekhan by BNP Paribas.

The NSE Nifty 50 opened at 19,521.60 down 0.10%, the BSE Sensex opened at 65,419.02 up 21.4 points.

“Bank Nifty witnessed a narrow rangebound session hovering near the 43,700-43,800 zone for the last 2 sessions with the bias maintained little bit weak and has the near-term crucial support zone of 43400 levels. A decisive breach below the 43,400 zone shall further weaken the overall trend and expect for further slide till 42,000 levels. Bank Nifty would have the daily range of 43,400-44,000 levels,” said Vaishali Parekh, Vice President – Technical Research, Prabhudas Lilladher.

The NSE has added Indiabulls Housing Finance to its F&O ban list for October 23, 2023.

“In the past week, the Nifty index closed at 19,513, marking a downbeat performance influenced by surging US Treasury yields and lackluster initial earnings reports from companies like INFY, BAJAJ FINANCE, and TCS. HDFC BANK’s results also did little to improve sentiment, while geopolitical tensions led to reduced investor exposure. The 2-year and 10-year Treasury notes approached levels not seen since 2006 and 2007, with the 10-year yield nearly reaching the 5% mark, last witnessed in July 2007. However, hopes of sentiment improvement rest on the positive Q2 results from ICICI Bank, Kotak Bank, and RBL Bank, driven by lower provisions and enhanced asset quality. The technical landscape for Nifty and Bank Nifty is challenging, with Nifty trading below the rising trendline from March 2023 and downside risk at the October low. Bank Nifty is also at risk of breaking the trendline from June 2022, with potential downside at 41500. Despite this, optimism remains for TATA Motors, DIXON Technologies, Zomato, and Coal India, offering trading opportunities. Zomato stands out as a stock to consider, with long positions at the current price (CMP 113) targeting 121/143 and more aggressive 1-year targets at 175. Nifty’s options data suggests a trading range of 18900-19700, with 20000 as a key resistance zone. The Volatility Index stands at 10.81.”

– Prashanth Tapse, Senior VP (Research), Mehta Equities.

Foreign institutional investors (FII) purchased shares worth net Rs 456.21 crore, while domestic institutional investors (DII) added shares worth net Rs 8.53 crore on October 20, 2023, according to the provisional data available on the NSE.

WTI crude prices are trading at $87.30, down 0.89%, while Brent crude prices are trading at $91.53, down 0.68%, on Monday morning.

US stocks ended sharply lower for the day and week on Friday as investors worried about more interest rate hikes and the Israel-Hamas conflict spreading, reported Reuters. The tech-heavy Nasdaq Composite tanked 202.37 points, or 1.53%, to 12,983.81. The S&P 500 plunged 53.84 points, or 1.26%, to 4,224.16, while the Dow Jones Industrial Average dropped 286.89 points, or 0.86%, to 33,127.28.

“Middle East tensions and elevated US bond yields steered the market to a consolidation path this week. A weak start to the earnings season, disappointment from the IT sector, and a mixed bag of results from banks influenced investors to book profits from the table. FIIs continued to withdraw funds as the US Fed Chair emphasised the imperative for continued monetary tightening policy and hold interest rate high. Investors are likely to remain cautious in the near term due to concerns about the long implication of geopolitical tensions in the Middle East.

We expect volatility to persist, although long-term investors will find bargain hunting opportunities due to an optimistic Q2 FY24 earnings estimate and a festival-driven demand environment. Weak ahead, market participants will vigilantly monitor US GDP data for insights into the Fed’s interest rate trajectory. Additionally, as the earnings season gains momentum, investor sentiment will be shaped by corporate’s management commentary and bottom-up investment approach.”

– Vinod Nair, Head of Research at Geojit Financial Services.