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

Indian markets closed lower on Tuesday with Sensex and Nifty extending their decline for the second straight session as sustained foreign portfolio outflows and a weakening rupee kept investors on edge. Uncertainty over a potential US trade deal added to the cautious mood on Dalal Street.

The S&P BSE Sensex closed down 533 points, or 0.63%, at 84,679.86, while the NSE Nifty 50 settled down 167 points, or 0.64%, at 25,860.10.

Here’s how analysts read the pulse of the market:

Continued weakness in the INR led to fresh record lows due to continued FII outflows and depressed global sentiment, while smallcaps and midcaps declined in IT, metals, banking and real applications limited caps, said Vinod Nair, head of research at Geojit Investments.

“Volatility is expected to rise amid currency volatility and uncertainty over foreign inflows. Progress on the US-India trade deal and rupee stabilization will be important, while softer commodity prices and improving earnings visibility provide a constructive medium-term backdrop,” Nair said.

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US markets

Wall Street stocks were little changed early Tuesday as markets absorbed U.S. data pointing to a sluggish jobs market, while Ford advanced despite announcing a $19.5 billion cost hit.

The US unemployment rate rose to 4.6 percent in November from 4.4 percent in September. The US economy lost 105,000 jobs in October but gained 64,000 in November.

European markets

European stocks were muted on Tuesday, as gains in heavyweight financials and healthcare stocks were offset by sharp declines in defense and technology stocks, while investors turned cautious ahead of crucial US jobs data.

The pan-European STOXX 600 was up 0.2% at 583.39 by 0912 GMT on Monday, after marking its biggest one-day gain in nearly three weeks on Monday.

Major regional stock markets were broadly higher with Spain and France each up 0.3%.

Tech View

The day was in favor of the bears as the Nifty remained below the key 200 SMA on the hourly chart throughout the session, said Rupak De, senior technical analyst at LKP Securities, adding that the index failed to retest the morning’s highs, indicating complete control by the bears.

“On the downside, the support at 25,870 was breached, intensifying the bearish sentiment in the market. In the short term, the index may drift lower towards 25,700 and lower. On the upside, the 25,950-26,000 zone is likely to act as a crucial resistance,” said Day.

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Most active stocks in terms of turnover

HDFC Bank (Rs 1,994 crore), Vedanta (Rs 1,908 crore), RIL (Rs 1,812 crore), ICICI Bank (Rs 1,685 crore), Eternal (Rs 1,682 crore), Axis Bank (Rs 1,423 crore) and BSE (Rs 1,363 crore) were the most active stocks. High activity in 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 (traded shares: 71.28 crore), Tata Teleservices (traded shares: 13.34 crore), Ola Electric Mobility (traded shares: 7.19 crore), Eternal (traded shares: 5.86 crore), Yes Bank (traded shares: 5.83 crore and Power shares: 5.83 crore) Vedanta in terms of volume on NSE (Shares traded: 3.4 crore) was one of the most actively traded stocks.

Stocks show interest in buying

Shares of Kirloskar Oil, Tata Teleservices, Reliance Infrastructure, Triveni Engineering & Industries, Leela Palaces Hotels & Resorts, The Fertilizers & Chemicals Travancore and LT Foods witnessed strong buying interest from market participants.

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52 week high

Over 103 stocks touched their 52-week highs today while 139 stocks slipped to their 52-week lows. Among those hitting their 52-week highs were Vedanta and Tata Motors CV.

Selling pressure is seen in stocks

Ola Electric Mobility, Policy Bazaar, Transformers & Rectifiers, Axis Bank, Eternal, Swiggy and Awas Financiers witnessed significant selling pressure.

Sentiment meter bearish

Market sentiment was bearish. Out of 4,335 stocks traded on BSE on Tuesday, 2,523 stocks declined, 1,654 stocks gained, while 158 stocks remained unchanged.

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