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

The Indian market ended lower on Tuesday, after a brief bounce in the morning, only to unravel just as quickly, leaving investors with sharp intraday losses and a fresh sense of unease. The BSE Sensex tumbled 933 points from its day’s peak, while the Nifty 50 fell over 1%, as selling pressure intensified during the session to a market value of Rs. 2.6 lakh crore was eroded.

The Sensex touched an intraday high of 84,258.03 and slipped to a low of 83,324.84. The Nifty fell from its peak of 25,899.80 to an intraday trough of 25,627.40. At the end of the day, the Sensex was down 250 points or 0.3% at 83,627.69, while the Nifty was down 58 points or 0.22% at 25,732.30.

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

Vinod Nair, head of research at Geojit Investments, said fresh concerns about possible US tariffs on countries trading with Iran led to a slowdown in local equities, overshadowing initial optimism from the newly appointed US ambassador’s positive statements on trade deals. US bond yields, and continued FII outflows.

“On a brighter note, India’s December CPI remained within RBI’s target range, bolstering expectations of future rate cuts. However, the Q3 earnings season started on a subdued note, with weak results from leading IT majors. Profit booking was prevalent across most sectors, though small-cap stocks reported unprofitable gains.

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US markets

The S&P 500 and Nasdaq were flat on Tuesday after a largely in-line inflation report kept expectations for an interest rate cut this year, while investors weighed mixed quarterly results from JPMorgan and Delta Air Lines.

Excluding volatile food and energy components, US consumer prices rose 0.2% in December from the previous month, softer than economists’ forecast of a 0.3% increase. Headline and core CPI rose 2.6% year-on-year last month after rising by similar margins in November.

The data bolstered Fed bets on at least two more 25-basis-point interest rate cuts between June and December, with traders seeing a smaller chance of a third, per LSEG data.

European markets

European stock markets were mixed following a U.S. consumer price reading that suggested inflation was easing — though not enough to prompt the Federal Reserve Bank to ease initial rates.

Europe’s STOXX 600 reversed early gains to trade 0.27% lower at 609.27.

Tech View

Technically, the Sensex respected the support zone around 83100-83200, which acted as a strong cushion on session lows, said Hitesh Darji, technical research analyst at Choice Broking, adding that the immediate resistance has now been placed near 84100-84200, where previous updown attempts were weak before.

“Failure to sustain early gains and break below key psychological levels, the structure currently favors a neutral-to-cautious stance, with selective accumulation on dips as long as the support zone remains intact,” Taylor said.

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Most active stocks in terms of turnover

HDFC Bank (Rs 3,013 crore), ICICI Bank (Rs 2,048 crore), RIL (Rs 1,968 crore), Larsen & Toubro (Rs 1,940 crore), BSE (Rs 1,896 crore), TCS (Rs 1,836 crore) and Hindustan Copper (BSE Rs 1,36 crore) were the most active stocks. 2 crores were in stock. 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 (Shares traded: 105 crore), IFCI (Shares traded: 18.5 crore), Ola Electric Mobility (Shares traded: 7.7 crore), Suzlon Energy (Shares traded: 7.5 crore), Yes Bank (Shares traded: 6.6 crore), Bank of Maharashtra (Shares traded: 6.6 crore), Bank of Maharashtra (Shares traded: 7.5 crore) shares: 5 crore) was one of the most actively traded stocks in terms of volume on the NSE.

Stocks show interest in buying

Shares of Otham Investment, Maharashtra Scooter, PVR, Motilal Oswal, City Union Bank, Oil India Limited and Manappuram Finance were among the stocks that saw strong buying interest from market participants.

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52 week high

Over 82 stocks touched their 52-week highs today while 532 stocks slipped to their 52-week lows. Among those hitting their 52-week highs were SBI and Vedanta.

Selling pressure is seen in stocks

Dixon Tech, Vodafone Idea, AU Small Finance Bank, Trent, HEG, Larsen & Toubro and Graphite India saw significant selling pressure.

Sentiment meter bearish

Market sentiment was bearish. Out of 4,327 stocks traded on BSE on Friday, 2,143 stocks declined, 1,989 stocks gained, while 195 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)