Indian benchmark indices are likely to open on a positive note, hinted SGX Nifty as Nifty futures traded 53 pts higher at 18,164 level on the Singapore Exchange. “Markets traded under pressure on Wednesday and lost over a per cent amid mixed cues. This decline has engulfed the gains of the last four sessions in Nifty and selling pressure in the banking index, which was acting as a savior so far, has further deteriorated the mood. And, we feel the pressure may increase below 18000 levels in Nifty. Keeping in mind the scenario, it is prudent to limit leveraged positions and wait for clarity,” said Ajit Mishra, VP – Technical Research, Religare Broking Ltd.
7 key things to know before share market opens
Global market watch: Asia-Pacific markets climbed as investors shrug off the US Federal Reserve’s commitment to higher interest rates in tackling inflation. Australia’s S&P/ASX 200 rose 0.42%. In Japan, the Nikkei 225 was up 0.35% in its first hour of trade, while the Topix index inched up fractionally. South Korea’s Kospi rose 0.71%. Overnight in the US, Wall Street stocks gained after volatile trading following the release of minutes from the Fed’s last meeting, which showed officials laser-focused on controlling inflation even as they agreed to slow their pace of interest rate hikes. The Dow Jones Industrial Average rose 0.4%; the S&P 500 gained 0.75%, and the Nasdaq Composite added 0.69%.
Key levels to watch: “Nifty has closed over 18000 at an important psychological milestone, but has encountered significant resistance around 18250 in recent trading sessions. A break above 18200-18250 will be a critical level for the Nifty to begin its upward trip. Bank nifty, on the other hand, has support at 42800 levels and resistance at 43500. We expect the market to be extremely volatile until the Fed Meeting provides strong guidance on rate rises and inflation control. We advise taking a stock-specific approach,” said Ameya Ranadive, Equity Research Analyst, Choice Broking.
FII and DII data: Foreign institutional investors (FII) sold shares worth Rs 2,620.89 crore, while domestic institutional investors (DII) bought shares worth Rs 773.58 crore on January 4, as per provisional data available on the NSE.
Stocks under F&O ban on NSE: The National Stock Exchange has not added any stock under its F&O ban list for 5 January. Securities thus banned under the F&O segment include companies where derivative contracts have crossed 95% of the market-wide position limit.
Oil falls: Crude oil fell by more than 5% or $4 per barrel on Wednesday, posting the steepest percentage loss in the first two trading days of any year for over three decades, as investors worried about fuel demand as the global economy slows and Covid-19 cases grow in China. Brent futures settled at $77.84 a barrel, falling $4.26, or 5.2%. US crude settled at $72.84 a barrel, shedding $4.09, or 5.3%.
Citi trims India’s CAD forecast: Citi has cut India’s current account deficit forecast to 2.9% of GDP. The shortfall in the current account, the broadest measure of trade in goods and services, will probably be at 2.9% of gross domestic product, according to Citi’s India economist Samiran Chakraborty. That is smaller than the 3.3% seen previously, and a full percentage point lower than the 3.9% predicted in August.