The SGX Nifty signaled that domestic benchmark indices NSE Nifty and BSE Sensex might continue to extend their losses, as Nifty futures traded 50 points lower at 17,713.5 on the Singaporean exchange. On Monday, the markets snapped a nine-day gaining streak, with Sensex giving up the 60,000 mark and closing 520 points lower at 59,910 while Nifty closed just above 17,700, down by 121 points.
“The market responded negatively to the weak start of the earnings season by IT bellwether and their cautious outlook. On the global front, the US 10-year bond yield rose as solid US job data raised concerns over further rate hikes by the Fed. The earnings reports, primarily from the IT and banking sectors, will influence market trends in the coming days. We expect Nifty50 earnings to grow by 10% in Q4 FY23, driven by banking and finance, auto, telecom, and FMCG,” said Vinod Nair, Head of Research, Geojit Financial Services.
Asian Markets
Stocks in Asia-Pacific traded mixed as Japan’s Nikkei 225 was higher at 0.53% and Hong Kong’s Hang Seng index traded down by 0.41%. South Korea’s Kospi lost 0.27% in its first hour of trade. China’s Shanghai Composite traded lower by 0.12% while the Shenzhen Component was flat at 0.08%.
Crude Oil
Oil prices held steady in early trading on Tuesday after falling 2% in the previous session, with markets awaiting the release of economic data in China, looking for signs of economic recovery and growth to offset weakening demand elsewhere. Brent crude was flat at $84.76 a barrel at 0004 GMT, while U.S. West Texas Intermediate was up 5 cents at $80.88 a barrel.
FII/DII Data
Foreign institutional investors (FII) net sold shares worth Rs 533.20 crore, while domestic institutional investors (DII) net purchased equities worth Rs 269.65 crore on 17 April, according to the provisional data available on the NSE.
F&O Ban
The National Stock Exchange has Balrampur Chini Mills and Delta Corp securities on its F&O ban list for 18 April. 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
“The present weakness in the Nifty is now nearing an important support of around 17,600-17,500 levels, which is the previous upside broken resistance of the down sloping trend line as per change in polarity. The strong upside bounce of the last 9 sessions and a formation of new higher highs at 17,863 levels on Monday are all pointing towards a sizable downward correction ahead for the Nifty before showing upside bounce from the lower supports,” said Nagaraj Shetti, Technical Research Analyst, HDFC Securities.
Bank Nifty View
“Bank Nifty took resistance at 42,500 to 42,600 on the back of profit booking in HDFC BANK after a positive opening. With Asian markets weak at the start of the day, the positive opening in Bank Nifty triggered profit booking. The second half provided support for Bank nifty, with PSU banks coming to its rescue. Bank Nifty took support at 41,800 on the back of the good performance of PSU BANKS. As per the current closing index, it is still in the breakout zone for 42,600/43,000 levels, Downside support stands at 42,000-41,800,” said Rupak De, Senior Technical Analyst at LKP Securities.
Levels to watch
“Coming to the OI Data, on the call side, the highest OI observed at 17,800 followed by 18,000 strike price while on the put side, the highest OI was at 17,600 followed by 17,500 strike price. On the other hand, Bank nifty has support at 41,600 zone while resistance is placed at 42,800. The long term investor may opt for selective mid-cap and small-cap stocks in addition to large cap, which currently look appealing,” said Om Mehra, Equity Research Analyst, Choice Broking.