As global cues turned negative and concerns over continued monetary tightening weighed, Indian indices ended Friday’s session on a weak note. Nifty ended over 0.5% lower at 17,944, while Sensex also lost 0.52% to close at 61,002.5. Broader markets, meanwhile, underperformed their headline peers, with Nifty Midcap 100 falling 0.8%.

Here’s how analysts read the market pulse
“Lack of major triggers in the domestic market is attracting global cues to dictate the market trend. The US market is facing an unfavourable combination of higher-than-expected inflation and a stronger job market. The PPI (Producer Price Index) in the US came in at 6.0%, in contrast to the expectation of 5.4%. This suggests that interest rates have not yet peaked and will remain elevated for a long period,” Vinod Nair, Head of Research at Geojit Financial Services, said.

“This week, Nifty attempted to close above its big Budget Day high but profit booking stepped in towards the last day of the week and forced the index to close below its psychological 18,000 mark. There has been a significant rise in open interest (OI) build-up at 18,000 levels by both calls and puts sellers, it looks like a tug of war between them.

Technically the structure is still bullish and Nifty stands at the strong polarity support, failing to hold which the index is likely to see a further correction towards 17,650 – 17,500 zones. Only a sustained close above the 18,200- 18,250 zone is likely to trigger bullish momentum toward 18,450 – 18,500 levels,” Rohan Patil, Technical Analyst, SAMCO Securities, said.

That said, here’s a look at what some key indicators are suggesting for Monday’s action:

US Market: S&P 500 and Nasdaq down, Dow Jones up

The S&P 500 and the Nasdaq finished in the red on Friday and oil prices settled lower after US economic data prompted bets that the Federal Reserve would get more aggressive with interest rate hikes to battle stubborn inflation.Friday’s data showed a year-over-year 0.8% increase in export prices versus expectations for a decline of 0.2%. The Dow Jones Industrial Average (.DJI) rose 129.84 points, or 0.39%, to 33,826.69, the S&P 500 (.SPX) lost 11.32 points, or 0.28%, to 4,079.09 and the Nasdaq Composite (.IXIC) dropped 68.56 points, or 0.58%, to 11,787.27.

European shares close lower
European markets closed slightly lower on Friday, as investors continue to assess the impact of inflation and production data from the U.S. and U.K., alongside company earnings. The pan-European Stoxx 600 index provisionally ended the session down 0.2%, trimming losses from earlier in the day. Oil and gas stocks led losses with a 1.9% drop, followed by tech, which was down 1.6%. Britain’s FTSE 100 ended lower on Friday, with energy stocks leading losses as oil prices fell on concerns about interest rates staying higher for longer, while lender NatWest dropped on a dour earnings forecast.

Tech View: Small negative candle
A small negative candle was formed on the daily chart with long upper and lower shadow. Technically, this pattern indicates minor reversal in the market from the highs. The minor degree positive chart pattern like higher tops and bottoms continued on the daily chart and present weakness could be in line with a new higher bottom formation. but, there is no confirmation of any higher bottom reversal yet at the lows.

Stocks showing bullish bias
Momentum indicator Moving Average Convergence Divergence (MACD) showed bullish trade on the counters of Ambuja Cements, NMDC, Adani Enterprises, TCNS Clothing and JBM Auto among others.

The MACD is known for signaling trend reversals in traded securities or indices. When the MACD crosses above the signal line, it gives a bullish signal, indicating that the price of the security may see an upward movement and vice versa.

Stocks signaling weakness ahead
The MACD showed bearish signs on the counters of Wipro, Petronet LNG, Britannia and Medplus Health among others. Bearish crossover on the MACD on these counters indicated that they have just begun their downward journey.

Most active stocks in value terms
RIL (Rs 1326 crore), HAL (Rs 1135 crore ), Adani Enterprises (942 crore) and ICICI Bank (Rs 860 crore) were among the most active stocks on NSE in value terms. Higher activity on a counter in value terms can help identify the counters with highest trading turnovers in the day.

Most active stocks in volume terms
Vodafone Idea (Shares traded: 11.20 crore), Suzlon Energy (Shares traded: 6.12 crore), Yes Bank (Shares traded: 6.01 crore) and Zomato (Shares traded: 5.28 crore) were among the most traded stocks in the session on NSE.

Stocks showing buying interest
Shares of Global Health, UltraTech Cement, PNB Housing, Supreme Industries and Dalmia Bharat among others witnessed strong buying interest from market participants as they scaled their fresh 52-week highs, signaling bullish sentiment.

Stocks seeing selling pressure
Shares of Adani Gas, Adani Transmission, IPCA Laboratories, Alok Industries and BSE among others hit their 52-week lows, signaling bearish sentiment on the counters.

Sentiment meter favours bears
Overall, market breadth favoured bears as 1,504 stocks ended in the green, while 1,944 names settled with cuts.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)


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