The 30-share BSE Sensex settled down 1,017 points, or 1.24%, at 81,183, while the broader NSE Nifty closed down 293 points, or 1.17%, at 24,852.
Meanwhile, in line with global trends, Indian equity markets may face further declines on Monday following the latest US jobs report, which has added uncertainty to the outlook for a Federal Reserve rate cut. The US Labor Department reported that employers added 142,000 jobs in August, below expectations, while July’s job growth was revised up to 89,000, which was also below forecasts.
Here’s how analysts pulse the market:
“Technically, the index broke the 25,000-25,100 support zone on Friday, forming a bearish candle on the weekly scale. On the daily chart, the Nifty closed below its 21-day exponential moving average (DEMA), indicating further weakness. The next major support is near 24,480, where the 50-DEMA is located, in the short term, any bounce should be seen as an opportunity to book profits,” said Asit C Mehta Investment Intermediates.
Sharekhan’s Jatin Gedia said, “On the daily chart we can observe that the decline has led Nifty to reach the crucial support zone at 24850 – 24800 which is in line with the 20-day moving average and 38.2% Fibonacci retracement level. Nifty has crossed this support zone. Expect to hold and hence continue to maintain our short-term positive outlook on Nifty.
That said, here’s a look at what some key indicators suggest for Monday’s action:
US Market:
U.S. stocks fell on Friday, weighed down by a jobs report that showed continued labor market slack but left traders uncertain about how far the Federal Reserve will go in cutting interest rates.
All three major indexes were lower, with 11 sectors of the benchmark S&P 500 losing ground, led by declines in communications services, consumer discretionary and technology equities.
The S&P 500 and Dow had their biggest weekly declines since March 2023, with the Nasdaq posting its biggest weekly decline since January 2022.
European share:
European shares fell for their fifth straight session on Friday, after a widely expected US jobs report on the size of a potential Federal Reserve rate cut later this month gave mixed signals.
The pan-European STOXX 600 index fell 1%. The index also snapped a four-week winning streak, losing 2.5% in its worst weekly performance since the week ended August 2.
In Europe, all major country indexes fell about 1%, compared with analysts’ forecasts of 0.3%, with Germany’s DAX index falling 1.6% to a two-week low after the country’s industrial output fell 2.4% in July.
Tech View: Bearish Engulfing Candle
The Nifty formed a bearish candle on the weekly chart as it ended Friday’s trading session on a negative note as the index dipped ahead of the key US jobs report, which could influence the Federal Reserve’s decisions on the pace and magnitude of interest rate cuts.
A long bear candle was formed on the daily chart, indicating a sharp downside reversal for the market. 25,000 cluster support is decisively broken on the downside and Nifty closes lower. This pattern suggests confirmation of short-term top reversal pattern at 25,333 level, said Nagaraj Shetty of HDFC Securities.
In open interest (OI) data, the highest OI on the call side was seen at 25,000 and 24,900 strike prices, while on the put side, the highest OI was seen at 24,600 strike price followed by 24,800.
Stocks Showing Bullish Bias:
Momentum indicator Moving Average Convergence Divergence (MACD) showed bullish trade on counters of Supreme Industries, Gland Pharma, PNC Infratech, 3M India and Godavari Power.
MACD is known for indicating the opposite trend in traded securities or indices. When 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 further weakness:
MACD showed bearish signals on counters of RR Cable, Tata Power, Crompton Greaves, Tech Mahindra and Allcargo Logistics. A bearish crossover on MACD on these counters indicates that they have started their downward journey.
Most active stocks by value:
Indigo Paints (Rs 3,626 crore), SBI (Rs 3,180 crore), RIL (Rs 2,849 crore), Vodafone Idea (Rs 2,570 crore), HDFC Bank (Rs 2,134 crore), Zomato (Rs 1,963 crore) , and Tata Technologies (Rs 1,963 crore to Rs 1,477 crore) are among the 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: 190.2 crore), Yes Bank (Shares traded: 8 crore), Zomato (Shares traded: 7.6 crore), Easy Trip Planners (Shares traded: 6.7 crore), Canara Bank (Shares traded: 6 crore), Suzlon Energy (shares traded: 4.3 crore), and HFCL (shares traded: 4 crore) among others were among the most traded stocks of the session on NSE.
Stocks showing interest in buying:
Shares of Godfrey Phillips, Glenmark Life, Suven Pharma, Piramal Pharma, PI Industries, UTI AMC and Jubilant Life saw strong buying interest from market participants as they scaled their fresh 52-week highs, indicating bullish sentiment. .
Selling Pressure in Stocks:
No major stocks touched their 52-week lows on Friday.
The sentiment meter favors the bears:
Overall, market breadth favored the bears as 2,649 stocks ended in the red, while 1,307 names settled in the green.
(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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