Indian benchmark indices are likely to open decisively in the red, hinted SGX Nifty. On the Singapore Exchange, Nifty futures were trading lower, down 103 points, at the 17,515 level. Markets fell on selling pressure, snapping a three-day relief rally. Nifty closed under 17,600, losing almost 165 points while Sensex slid 541 points, settling at 59,806.
“The domestic market could hardly hold on to its previous gains as the Fed chair’s reaffirmation of his hawkish statement brought in more worries. In this backdrop, the upcoming US job data will have a substantial impact on the Fed’s policy decisions in its upcoming FOMC meeting. A stronger-than-expected jobs report will prompt the Fed to raise interest rates by 50 bps,” said Vinod Nair, Head of Research, Geojit Financial Services.
US Banking Stocks – Silicon Valley Bank
SVB Financial Group scrambled on Thursday to reassure its venture capital clients their money was safe after a capital raise led to its stock collapsing 60% and contributed to wiping out over $80 billion in value from bank shares. The lender on Wednesday launched a $1.75 billion share sale to shore up its balance sheet and navigate declining deposits from startups struggling for funds amid increased spending, according to Reuters
US Treasury Yields
Treasury yields dropped on signs that the Federal Reserve’s restrictive policy is beginning to work as intended. Treasury yields eased in the wake of the jobless claims data. Benchmark 10-year notes last rose in price to yield 3.9169%, from 3.976% while the 30-year bond last rose to yield 3.8712%, from 3.877%.
Asian Markets
Stocks in Asia-Pacific followed Wall Street’s cues, traded with deep cuts. Japan’s Nikkei 225 traded lower by 1.12%, and South Korea’s Kospi lost 0.90% in its first hour of trade. China’s Shanghai Composite and Shenzhen Component traded lower by 0.73% and 0.90%, respectively. Hong Kong’s Hang Seng index dropped 2.16%.
Crude Oil
Oil prices erased earlier gains to head lower over looming worries of softening demand in the face of a possible recession. U.S. crude fell 1.23% to settle at $75.72 per barrel, and Brent settled at $81.59 per barrel, down 1.29% on the day.
FII/DII Data
Foreign institutional investors (FII) net sold shares worth Rs 561.78 crore, while domestic institutional investors (DII) net acquired equities worth Rs 42.41 crore on 9 March, according to the provisional data available on the NSE.
F&O Ban
The National Stock Exchange has Balrampur Chini and GNFC on its F&O ban list for 10 March. According to the NSE, stocks are prohibited in the F&O sector when they have exceeded 95% of the market-wide position limit (MWPL). During the F&O ban period, no new positions are permitted for F&O contracts in that stock.
Technical View
“A long bear candle was formed on the daily chart, which indicates a formation of bearish engulfing type candle pattern. Formation of such a pattern after a reasonable upside could be considered as a bearish reversal pattern. Hence, one may expect to follow through weakness in the coming session.
“Nifty seems to have formed a new lower top at the important resistance of 17,800 levels (opening downside gap of 22nd Feb and weekly 10 and 20 period EMA) and one may expect further weakness down to 17,400 levels in the short term. Any upside bounce from here could encounter resistance around 17,680-17,700 levels,” said Nagaraj Shetti, Technical Research Analyst, HDFC Securities.
Levels to Watch
“Volume profile indicates Index has a strong support around 17,450-17,500 zone. Coming to the OI Data, on the call side, the highest OI observed at 17,700 followed by 17,800 strike prices while on the put side, the highest OI is at 17500 strike price. On the other hand, Bank Nifty has support at 40,700-40,900 while resistance is placed at 41,700-41,900 range,” said Devan Mehata, Equity Research Analyst, Choice Broking.