Jackson Hole, US Speaking at an economic conference at , Powell clearly supported imminent policy easing, noting that further cooling in the US job market would be undesirable. He expressed confidence that inflation is within reach of the US central bank’s 2% target. Analysts now predict that Powell’s dovish comments could benefit the Indian benchmark, potentially leading to further gains.
On Friday, the NSE Nifty 50 index was up 0.05% at 24,823, while the S&P BSE Sensex was up 0.04% at 81,086.
Here’s how analysts pulse the market
“Powell’s comments about cutting interest rates raise hopes that the US central bank will begin cutting policy rates from September. Equity markets generally benefit from rate cuts because lower interest rates will boost spending and stimulate the economy. US markets are already . has bounced higher, and others may follow,” said Viram Shah, CEO of Vested Finance.
Angel One’s Osho Krishan said, “Active participation of mid- and small-cap stocks as well as heavyweights and the banking sector laid a strong foundation and strengthened market sentiment. The dominance of bullish investors was evident throughout. Their strong advance-decline ratio Nifty Although helping the index close the bearish gap in the weekly time frame, replicating it next week and overcoming another bearish gap on the daily chart around the 24850-24950 subzone will be a challenging task After gaining, we may witness another lifetime high zone in the benchmark, starting at 24750-24700.-24600 with good upside for the bulls.”
That said, here’s a look at what some key indicators suggest for Monday’s action:
US market
U.S. stocks rose on Friday as unconvincing comments from U.S. Federal Reserve Chairman Jerome Powell bolstered expectations that the central bank will cut its key policy rate in September.
All three major US stock indexes rose following the release of Powell’s prepared remarks, with megacap growth stocks providing the most muscle. Small caps and regional banks handily outperformed the broader market.
The S&P 500 rose 62.79 points, or 1.13%, to close at 5,633, while the Nasdaq Composite added 258 points, or 1.47%, to 17,877. The Dow Jones Industrial Average rose 462 points, or 1.14%, to 41,168.
European stocks
Europe’s STOXX 600 ended near session-highs on Friday amid broad-based gains, as global markets rallied after Federal Reserve Chairman Jerome Powell said “the time has come” to cut interest rates.
The pan-European STOXX 600 index rose 0.5% to 518 at the close, its highest level in three weeks and a third straight weekly advance.
Rate-sensitive real estate jumped 1.3%, hitting an 18-month high, while utilities, often cited as a bond proxy, rose 1%.
Tech View
The Nifty formed a small negative candle on the daily chart on Friday with a gain of 12 points. On the daily chart, the index continued to make higher highs and higher lows as dips were bought.
The underlying trend of Nifty has been bearish with a positive bias. A further bounce from here could push the Nifty towards 25000-25100 levels in the near term. Immediate support is at 24650, said Nagaraj Shetty of HDFC Securities.
On the weekly chart, a reasonable positive candle with a small lower shadow was noted. Last week’s significant down gap resistance on the weekly chart has been completely filled at the 24700 level and the market has closed above it, he said.
Stocks showing a bullish bias
Momentum indicator Moving Average Convergence Divergence (MACD) showed bullish trade on counters of DOMS Industries, Railtel Corp, Apar Industries, Kalpataru Power, Solar Industries and Devyani International.
MACD is known for indicating the opposite trend 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 signal further weakness
MACD is Dr. Counters of Lal PathLabs, HDFC Bank, Lupine, ZF Commercial Vehicle Control Systems, Infosys and Metropolis Health showed bearish signs. A bearish crossover on MACD on these counters indicates that they have started their downward journey.
Most active stocks by value
CDSL (Rs 3,266 crore), Zomato (Rs 2,715 crore), Nayaka (Rs 2,684 crore), Tata Technologies (Rs 1,803 crore), HDFC Bank (Rs 1,654 crore), Indigo (Rs 1,575 crore), and RVNL (Rs. 1,575 crore), and R.V.N.L. ) was among the other most active stocks on the NSE in terms of value. High activity on a counter in terms of value can help identify counters with the highest trading turnover in a day.
Most active stocks in terms of volume
Vodafone Idea (Shares traded: 36.9 crore), Nayaka (Shares traded: 12 crore), Yes Bank (Shares traded: 11.1 crore), Alok Industries (Shares traded: 10.6 crore), Zomato (Shares traded: 10.2 crore), GMR Infra (Shares traded: 9.5 crore), and Suzlon Energy (Shares traded: 6.7 crore) among others were among the most traded stocks of the session on NSE.
Stocks show interest in buying
Shares of Minda Corporation, Phillips Carbon, Himadri Specialty, Naika, DOMS Industries, Craftsman Automation and Indigo saw strong buying interest from market participants as they scaled their fresh 52-week highs, indicating bullish sentiment.
Selling pressure is seen in stocks
No major stocks touched their 52-week lows on Friday.
The sentiment meter favors the bulls
Overall, market breadth favored the bulls as 2,018 stocks ended in the green, while 1,939 names settled in the red.
(Disclaimer: Recommendations, suggestions, views and opinions given by experts are their own. These do not represent the views of Economic Times)
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