"Reliance Q2 Result Preview & Dow Jones All Time High" Pre-Market Report 14 Oct 2024 Range Analysis

Summary

In the pre-market report for October 14, 2024, key highlights include strong Q3 earnings from JP Morgan Chase and Wells Fargo, which boosted US markets despite concerning inflation data. Indian markets are set for a gap-up opening, influenced by mixed industrial production figures and continued FII selling. Reliance Industries and HCL Tech are expected to release Q2 results, with expectations for scrutiny on revenue and profit margins. Technical analysis indicates Nifty's struggle at the 25,000 mark, while Bank Nifty shows bearish patterns, emphasizing a cautious outlook amid fluctuating trading ranges.

Takeaways

• 📈 JP Morgan Chase and Wells Fargo reported Q3 earnings that exceeded analyst expectations, with JP Morgan's stock rising over 4% and Wells Fargo up by 5.6%.
• 📊 Despite positive earnings, U.S. inflation data released last week was disappointing, indicating ongoing economic concerns.
• 🛢️ Oil prices decreased by around 1% due to demand worries from floods in Florida, with WTI crude trading around $74.5 per barrel.
• 🇮🇳 In the Indian market, industrial production growth contracted for the first time in two years, primarily due to weak mining and lower electricity generation.
• 💵 Foreign Institutional Investors (FIIs) were net sellers in the cash market for the 10th consecutive session, selling ₹4,160 crore, while Domestic Institutional Investors (DIIs) net bought ₹3,730 crore.
• 📉 The Nifty index showed weakness, forming a small bearish candle and closing just below the 25,000 mark after consolidating within a narrow range.
• 🔍 Technical analysis indicates that the Nifty has been taking support between 24,900 and 25,000, but a breakdown may lead to further selling pressure.
• 💡 The Bank Nifty formed a bearish candlestick pattern but remained above its 100-day moving average, indicating potential volatility ahead.
• 📅 Upcoming earnings reports from Reliance Industries and HCL Tech are highly anticipated, with market participants closely scrutinizing their performance.
• 📊 The broader trading range for the market is projected between 24,500 and 25,500, with immediate focus on support at 24,700.

Q & A

What were the key earnings results released by US banks last Friday?

JP Morgan Chase and Wells Fargo both reported Q3 earnings that beat analyst expectations, with JP Morgan's stock increasing by 4% and Wells Fargo's by 5.6%.

How did the US stock markets respond to the earnings reports?

The US markets reacted positively, with the Dow Jones up by 97 points, S&P 500 up by 61 points, and NASDAQ up by 33 points.

What was notable about the US inflation data released last week?

Despite positive earnings from banks, US inflation data was concerning, with wholesale inflation above expectations and one-year inflation expectations rising to 2.9%.

What impact did the flooding in Florida have on oil prices?

The flooding caused demand worries, leading to a decrease in oil prices by around 1%, with WTI trading at approximately $74.5 per barrel and Brent at $78 per barrel.

What was the situation regarding Foreign Institutional Investors (FIIs) in the Indian market?

FIIs were net sellers for the tenth consecutive session, selling ₹4,160 crore, while Domestic Institutional Investors (DIIs) supported the market with net buying of ₹3,730 crore.

What are the expected financial results for Reliance Industries and HCL Tech?

Reliance Industries is expected to see a 2.2% increase in revenue and a 24% increase in net profit, while HCL Tech expects a 2% increase in revenue and a 6% increase in EBIT.

What technical indicators are highlighted for the Nifty index?

The Nifty closed marginally below the 25,000 mark, forming a small bearish candle and taking support around the 24,900 level, indicating ongoing range-bound trading.

What does the options data suggest about market sentiment?

Options data indicates a broader trading range between 24,500 and 25,500, with immediate levels at 24,700 and 25,200, reflecting cautious sentiment in the market.

What were the conditions for the Bank Nifty last Friday?

The Bank Nifty opened 40 points down but managed to close above the 100-day moving average, trading within the previous week’s range.

What is the overall outlook for the market as of October 14, 2024?

The overall market outlook appears cautious with some optimism from strong earnings, but concerns regarding rising inflation and weak industrial performance persist.