Domestic benchmark indices NSE Nifty and BSE Sensex were dragged by weak Asian cues. Fears of further monetary policy tightening from the US Federal Reserve damped sentiments, causing Nifty to end down 0.48% or 85.6 points at 17,770.9 and Sensex settled at 60,431, down by 250 points or 41%.
Markets Ahead: Inflation expectations, Q3 Earnings and Adani rout weaken markets
Markets weak ahead of inflation data: S Ranganathan, LKP Securities
Adani group continuing to add anxiety: Vinod Nair, Geojit Financial Services
In response to rising bond yields and the dollar index, the domestic market is experiencing a broad-based sell-off, with IT and PSBs at the forefront. Clampdown in Adani group is adding anxiety to the domestic market. Domestic inflation is expected to rise from its 12-month low of 5.7% in December, nudged up by higher food inflation, while US inflation is expected to fall further from its December low of 6.5%, alleviating concerns about US rate hikes. However, interest rates are expected to stay high in 2023 and elevated yields will be a discomfort for equity.
Nifty Technical View: Bearish candles formed on daily charts
Nifty witnessing profit-booking: Shrikant Chouhan, Kotak Securities
Technically, near the 20-day SMA, Nifty consistently witnessed profit booking. A bearish candle on daily charts and a close below 17,800 indicating further weakness from the current levels. For the traders 17,850 would act as a key resistance zone below the same, the Nifty could slip till 17,650-17,600. On the flip side, a fresh uptrend rally is possible only after the dismissal of 17,850, above which, the market could move up to 17,925-17,950.
Resistance at 17,877: Deepak Jasani, HDFC Securities
Nifty has formed a bearish Engulfing pattern suggesting more pain in the near term. A break of 17,721 could lead to a faster fall towards the 17,517-17,545 band. On up moves, 17,877 could be tough to breach in the near term.