Ahead of the market: 10 things that will determine stock action on Monday

India’s benchmark equity indices Sensex and Nifty 50 entered daily and weekly losses on Friday, weighed down by foreign outflows, slowing corporate earnings and rising tensions in the Middle East.

The NSE Nifty 50 fell around 0.2%, while the S&P BSE Sensex fell 0.4% this week. They also lost about 4.5% last week, the worst decline since June 2022. Both indices are down 5% from record-highs hit on September 27 and have posted losses in eight of the past 10 sessions.

Here’s how analysts pulse the market:

“The psychological support of 25,000 was breached on the close for two consecutive days, indicating that the weakness is likely to continue. At present, the bears are in full control of the markets and are using every pull back rally. Short position for Nifty Now seen at 24,920 and 24,750, immediate resistance for Nifty is at 25,000-050 level and next resistance is at 25,250-275 level,” Tejas Shah, Technical Research. & BlinkX.

Hrishikesh Yedve of Asit C Mehta Investment Intermediates said, “Technically, on the daily chart, the index forms a small red candle, which indicates uncertainty. However, the index is still above the intra-bar candlestick low, as well as the 75-day Exponential moving average support Thus, levels of 25,150-25,350 are possible as long as the index remains above the lows of 24,690.

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

US market

The S&P 500 and Dow hit record closing highs on Friday, with financial stocks the biggest gainers after banks reported strong quarterly results while the latest inflation data supported expectations of a rate cut by the US Federal Reserve in November.

Also on Friday, data from the US Department of Labor showed that the producer price index for final demand was unchanged on a monthly basis in September.

European stocks

European stocks reversed early losses and ended at a one-week high on Friday as investors turned their attention to updates on China’s stimulus plans, corporate earnings and an interest rate decision by the European Central Bank.

The continent-wide STOXX 600 index ended up 0.5%, and was on track for a weekly gain of 0.6%. Britain’s FTSE 100 rose 0.2%, while Germany’s DAX and Spain’s IBEX closed up 0.7% and 0.5% respectively.

Take View: Small negative candlestick

Nifty formed a small negative candlestick with small upper and lower shadow on the daily chart to indicate continuation of narrow range movement in the market. A higher wave type candlestick pattern formation was observed in the weekly scale.

The underlying trend of Nifty remains volatile. After laying close to the crucial support around 24500 level, there is more possibility of an upside bounce in the market from here or lower support. Nagaraj Shetty of HDFC Securities said immediate resistance is placed at 25250.

Stocks showing a bullish bias

Momentum indicator Moving Average Convergence Divergence (MACD) showed bullish trade on counters of Nippon Life AMC, Valor Estate, Motilal Oswal Financial Services, Olectra Greentech, Mankind Pharma and Angel One.

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 signal further weakness

MACD showed bearish signs on the counters of Vedanta, Five-Star Business Finance, Naveen Florin, Balrampur Chinese, Paytm and 3M India. A bearish crossover on MACD on these counters indicates that they have started their downward journey.

Most active stocks by value

BSE (Rs 2,848 crore), Bandhan Bank (Rs 2,670 crore), TCS (Rs 2,398 crore), HDFC Bank (Rs 1,954 crore), Usha Martin (Rs 1,844 crore), SBI (Rs 1,141 crore) , and Mazagon Dock Shipbuilders (Rs Rs 1,100 crore) were 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

Bandhan Bank (Shares traded: 12.9 crore), JP Power (Shares traded: 11.7 crore), JM Financial (Shares traded: 5.7 crore), Tata Steel (Shares traded: 5.3 crore), Yes Bank (Shares traded: 5.1 crore), Usha Martin (shares traded: 4.4 crore), and Suzlon Energy (shares traded: 3.2 crore) among others were among the most traded stocks of the session on NSE.

Stocks show interest in buying

Shares of Usha Martin, BSE, JM Financial, Ipca Labs, Mankind Pharma, MCX India and Divi’s Labs among others saw strong buying interest from market participants as they scaled their fresh 52-week highs, indicating bullish sentiment. is

Selling pressure is seen in stocks

Shares of CreditAccess Grameen hit their 52-week low, signaling bearish sentiment over the counter.

Sentiment meter bulls

Overall, market breadth favored the bulls as 2,068 stocks ended in the green, while 1,840 names settled in the red.

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