The Nifty 50 index fell 0.49% to 24,918, while the S&P BSE Sensex lost 0.49% to 81,523.
This is how analysts read the market pulse:
“On the daily chart, the Nifty is taking support from an ascending trend line and has formed a bearish candlestick. The Nifty has strong support near the 24,800 level. If it breaks this level, it could potentially correct lower towards 24,600 and 24,400 in the near term. On the other hand, 25,200 is acting as a resistance level and the price may remain sideways within a broad range of 24,800 to 25,200,” said Mandar Bhojane of Choice Broking.
Hrishikesh Yedve of Asit C. Mehta Investment Intermediates said, “Technically, on the daily scale, Nifty failed to sustain above the trend line resistance and formed a red candle, which indicates weakness. As long as the index remains below the trend line resistance, which is around 25,150 level, caution is advised on the upside. On the downside, the 34-DEMA support is located around 24,750, which will serve as a significant support for Nifty in the near term.”
That said, let’s take a look at what some key indicators suggest for Thursday’s action:
US Market:
Wall Street stocks fell sharply on Wednesday as U.S. Treasury yields hit their lowest level in more than a year. The drop came after a key inflation report indicated uneven price growth, which will likely lead to a 25-basis-point rate cut by the Federal Reserve next week.
All three major U.S. stock indexes fell at the start of trading, while Brent crude prices rebounded from a 3.5-year low. Consumer Price Index The CPI (consumer price index) showed annual inflation cooled to 2.5%, a decline of 40 basis points. However, the core CPI, excluding food and energy, rose 0.3% month-on-month and 3.2% year-on-year. Market attention also shifted to Tuesday night’s US presidential debate, where Vice President Kamala Harris and former President Donald Trump will face off. Donald Trump They clashed on a number of issues, including the economy and immigration.
European stocks:
European stocks closed unchanged on Wednesday, with gains in technology stocks offset by falls in property stocks. Investors focused on the European Central Bank’s upcoming interest rate decision on Thursday. The pan-European STOXX 600 index was little changed on the day.
In the UK, the benchmark FTSE 100 index fell 0.2%. July GDP data indicated no month-on-month change in UK economic output.
Tech Outlook: Bearish Candle
The Nifty formed a bearish candle on the daily chart as Indian markets closed weaker.
The recent low of 24,753 is expected to offer near-term support to the Nifty. On the higher side, 25,200 becomes a strong resistance in the Nifty and unless it is overcome, traders should remain cautious, said Devarsh Vakil of HDFC Securities.
In the open interest (OI) data, the highest OI on the buy side was seen at the strike prices of 25,000 and 25,100, while on the put On the other hand, the highest OI was at the strike price of 24,800, followed by 24,900.
Stocks showing bullish bias:
Momentum indicator Moving Average Convergence-Divergence (MACD) showed bullish trade on the counters of TVS Holdings, PI Industries, Hawkins Cookers, RBM Infracon, Himadri Speciality Chemical, Tata Communications, Dodla Dairy, Havells India, Greenpanel Industries and GM Breweries among others.
The MACD is known for signaling trend changes in traded securities or indices. When the MACD crosses above the signal line, it gives a bullish signal, indicating that the security’s price may experience an upward movement and vice versa.
Actions that indicate weakness in the future:
The MACD showed bearish signals on the counters of Craftsman Automation, Swaraj Engines, Shriram Finance, SBI Life Insurance, SBI Life, Ceat, Muthoot Finance, Vijaya Diagnostic Centre and Motilal Oswal Financial Services among others. The bearish crossover of the MACD on these counters indicated that they have just started their bearish journey.
Most active stocks in terms of value:
Tata Motors (Rs 3,555 crore), Zomato (Rs 3,362 crore), Prism Johnson (Rs 2,236 crore), HDFC Bank (Rs 1,829 crore), SBI (Rs 1,556 crore), Paytm (Rs 1,499 crore) and ICICI Bank (Rs 1,480 crore), among others, were among the most active stocks on NSE in terms of value. Higher activity on a counter in terms of value can help identify the counters with higher trading volumes on the day.
Most active stocks in terms of volume:
Vodafone Idea (shares traded: Rs 35.8 crore), YES Bank (shares traded: Rs 24 crore), Zomato (shares traded: Rs 12.1 crore), Suzlon Energy (shares traded: Rs 12.1 crore), Prism Johnson (shares traded: Rs 9.6 crore), ONGC (shares traded: Rs 4.4 crore) and Piramal Pharma (shares traded: Rs 3.6 crore), among others, were among the most traded stocks in the session on NSE.
Stocks showing buying interest:
Shares of Prism Johnson, Apar Industries, PNB Housing, Century Textiles, Bajaj Auto, Natco Pharma and Jyothy Labs, among others, witnessed strong buying interest from market participants as they hit their fresh 52-week highs, indicating bullish sentiment.
Stocks see selling pressure:
No major stocks hit their 52-week lows on Wednesday.
Sentiment meter favors bears:
Overall, market breadth favored the bears as 1,603 stocks ended in the red, while 2,368 names ended in the green.
(Disclaimer: The recommendations, suggestions, views and opinions of the experts are their own and do not represent the views of the Economic Times)
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