The Indian market is expected to open on a flat note amid mixed global cues as investors remain cautious on interest rate hikes by a slew of central banks worldwide.
Asian shares were mixed with Japanese shares extending gains to reach their highest level since 1990 after the country’s headline inflation rate in May eased to 3.2% from 3.5% in April.
Comments from US Federal Reserve chairman Jerome Powell that they would bring more hikes this year sent US 10-year treasury yield rising to 3.79% from 3.73% late Wednesday.
Meanwhile, the trends on SGX Nifty also indicate a flat start for the broader index in India. The Nifty futures were trading 12 points, or 0.06%, lower at 18,819 on the Singaporean Exchange.
The shares of Indian IT services companies will remain in focus after Accenture forecast weaker-than-expected fourth-quarter revenue, flagging concerns about dwindling IT spending.
Read here: Global market: SGX Nifty, high bond yields to Accenture’s dismal revenue forecast – key triggers for Indian stock market
On Thursday, the Indian equity indices ending lower, snapping their two-day winning run, amid weak global sentiment as the risk appetite of investors remained low on concerns over rate hikes a day after Federal Reserve chairman Jerome Powell said the US Fed would bring more hikes this year.
The Sensex closed 284.26 points, or 0.45%, lower at 63,238.89, while the Nifty settled at 18,771.25, down 85.60 points , or 0.45%.
“The domestic market is currently witnessing increased volatility as it hovers around its historical peaks. This heightened volatility has also affected mid- and small-cap stocks, which have shown resilience. Moreover, the weak global indicators have had an impact on the domestic market, as they experienced declines following concerns of potential rate hikes, prompted by comments from the Fed chair regarding the fight against inflation,” said Vinod Nair, Head of Research at Geojit Financial Services.
The Foreign institutional investors (FIIs) net bought Indian shares worth ₹693.28 crore, on Thursday, while Domestic Institutional Investors (DIIs) net purchased shares to the tune of ₹219.42 crore, as per provisional data available on the exchanges.
Technically, Nifty failed to make a new all-time high and is facing resistance around the levels of 18,900. Meanwhile, the daily 10 and 20 EMA are intact around 18,745 and 18,640 levels, respectively, which are acting as the immediate support levels.
“A long negative candle was formed on the daily chart at the swing high of 18,886 levels, which indicates a short term reversal pattern on the downside. The rising wedge type pattern has started to form at the higher levels,” said Nagaraj Shetti, Technical Research Analyst, HDFC Securities.
Nifty almost tested the previous swing high seen in December 2022, but profit booking in the broader markets led sell-off towards the end.
“The momentum readings on the midcap index are highly overbought and needs to cool-off which can be seen either by some consolidation (time-wise correction) or some price-wise correction. Hence, traders need to be selective in stock picking and look for buying opportunities on declines when the overbought set ups cools-off,” said Ruchit Jain, Lead Research, 5paisa.com.
Jain believes important support for Nifty is placed around the 20 DEMA at 18,640 and a break below the same could then lead to some corrective phase in the index. Till then, the uptrend still remains intact.
Also Read: Day trading guide for today: Six buy or sell stocks for today — 23rd June
On the higher side, he said, 18,850-18,900 was the immediate resistance range as the index was witnessing some hurdle around this previous high. A move above the same will result in a continuation of the uptrend.
Meanwhile, the Relative Strength Index (RSI) displayed a bearish crossover, indicating a weakening bullish momentum.
Rupak De, Senior Technical analyst at LKP Securities believes the current trend seems to be sideways to negative, as long as the index remains below 18,900.
“On the downside, a support level is identified at 18,700. If the index decisively falls below this level, it may trigger a significant correction in prices,” said De.
For much part of the session on the weekly expiry day, the Bank Nifty index witnessed some strength, but it faced resistance around the 44,000 – 44,100 range which is a hurdle seen on the lower time frame charts.
“A breakout above 44,100 could lead to the next leg of the upmove in the banking index post the recent consolidation. But till it is trading below this hurdle, the trend remains sideways with immediate support around 43,350,” Jain said
Kunal Shah, Senior Technical & Derivative analyst at LKP Securities believes the overall market sentiment remains negative, suggesting a sell-on-rise approach.
“The lower end support level is at 43400, which is the last hope for the bulls. The momentum indicator RSI is trading below the level of 60 which confirms the weak momentum on the upside,” Shah said.
Catch Live Market Updates here
Disclaimer: The views and recommendations given in this article are those of individual analysts and brokerage firms. These do not represent the views of Mint. We advise investors to check with certified experts before taking any investment decisions.
“Exciting news! Mint is now on WhatsApp Channels 🚀 Subscribe today by clicking the link and stay updated with the latest financial insights!” Click here!
Get the best recommendations on Stocks, Mutual Funds and more based on your Risk profile!
Download the Mint app and read premium stories
Log in to our website to save your bookmarks. It’ll just take a moment.
You are just one step away from creating your watchlist!
Oops! Looks like you have exceeded the limit to bookmark the image. Remove some to bookmark this image.
Your session has expired, please login again.
You are now subscribed to our newsletters. In case you can’t find any email from our side, please check the spam folder.
This is a subscriber only feature Subscribe Now to get daily updates on WhatsApp