The NSE Nifty 50 index fell 0.85% to 24,139, while the S&P BSE Sensex fell 0.87% to 78,956.
Here’s how analysts read the pulse of the market:
“On the daily chart, we can observe that the Nifty has seen a breakdown from consolidation on the downside. The selling pressure may intensify on the downside. The immediate support remains at 24037 which is the 40-day moving average. A breach below this may occur. Take Nifty down towards 23600. On the upside, 24300 is an immediate hurdle from a short-term perspective,” Sherkhan’s Jatin Gedia.
Rupak De, Senior Technical Analyst, LKP Securities said, “The bear market is back as the index repeatedly failed to break above the 21 EMA. Near-term trend looks negative. On the upside, 24,250 now acts as new resistance. The level , and as long as the Nifty remains below 24,250, on the downside, the initial support is around 24,000, then it may fall further towards 23,700.”
That said, here’s a look at what some key indicators suggest for Wednesday’s action:
US Market:
Wall Street rose on Tuesday as producer price data signaled easing inflationary pressures, setting the stage for a possible Federal Reserve rate cut in September. Additionally, Starbucks grew after the appointment of Chipotle’s Brian Nicol as CEO.
Stocks were mixed on Monday, with the S&P 500 almost unchanged and the Nasdaq up modestly. This comes after a volatile week featuring mixed economic reports and a rate hike by Japan’s central bank.
European Stocks:
Europe’s benchmark stock index rose to a near two-week high on Tuesday on rising expectations of a US Federal Reserve interest rate cut in September, despite weak earnings from Swiss medtech firm Techon. The STOXX 600 index rose 0.5%, with the healthcare and utilities sectors leading, while basic resources lagged.
Spain’s final EU-aligned inflation rate fell to 2.9% in July from 3.6% in June. German investor sentiment fell more than expected in August, marking the biggest decline in two years. Spain’s benchmark index led the regional gains with a rise of 0.7%, while Germany, France, London and Italy saw gains of between 0.2% and 0.5%.
Take View: Long negative candlestick
The Nifty formed a long negative candle above the 24,100-level on the daily chart, down 208 points in Tuesday’s session, indicating the possibility of a downside breakout of range movement.
The recent swing high of 24,472 appears to be a lower peak for the Nifty as per the daily time frame chart. A slide below another lower support at 24,000-23,900 levels could trigger a reasonable downward correction in the market. The immediate resistance is placed at the 24,350 level, said Nagaraj Shetty of HDFC Securities.
Stocks Showing Bullish Bias:
Momentum indicator Moving Average Convergence Divergence (MACD) showed bullish trade on counters of Inox Wind Energy, TVS Holdings, V-Mart Retail, India Glycols, CDSL, Suven Pharma and Wockhardt.
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 Atul, Sun TV Network, ICICI Prudential Life Insurance and FirstSource Solutions. A bearish crossover on MACD on these counters indicates that they have started their downward journey.
Most active stocks by value:
HDFC Bank (Rs 4,360 crore), RVNL (Rs 2,459 crore), Triveni Turbine (Rs 1,674 crore), Suzlon Energy (Rs 1,588 crore), ICICI Bank (Rs 1,538 crore), SBI (Rs 1,419 crore ), and Aarti Industries (Rs. 1,419 crore) at Rs. 1,322 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:
Vodafone Idea (Shares traded: 53.8 crore), Suzlon Energy (Shares traded: 19.3 crore), Yes Bank (Shares traded: 17.5 crore), Ratan India Infra (Shares traded: 13 crore), HFCL (Shares traded: 7.4 crore), Trip Planners (shares traded: 5 crore), and IRFC (shares traded: 4.5 crore) were among the other most traded stocks in the session on Easy NSE.
Stocks showing buying interest:
Shares of Triveni Turbine, Canes Technology, Fortis Healthcare, Ajanta Pharma, Gujarat Pipavav, Balrampur Chinese and Oil India witnessed strong buying interest from market participants as they scaled their fresh 52-week highs, indicating bullish sentiment. .
Selling Pressure in Stocks:
Shares of Equitas Small Finance Bank hit their 52-week low, signaling bearish sentiment on the counters.
The sentiment meter favors the bears:
Overall, market breadth favored the bears as 2,676 stocks ended in the red, while 1,266 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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