Ahead of Market: 10 things that will decide D-Street action on Thursday

The benchmark indices ended Wednesday’s session lower with Nifty ending down 0.25% at 18,157. Broader markets performed even worse but Bank Nifty ended higher after clocking new record highs intra-day.

Rupak De, Senior Technical Analyst at LKP Securities, said, “Indian Nifty remained volatile with a predominant bearishness on Wednesday's trading. On the higher end, the headline index has found resistance around 18,300. The overall trend is expected to remain volatile as long as it remains below 18,300. A decisive move above 18,300 may induce a rally towards 18,600. However, failure to move beyond 18,300 may trigger further profit taking."

Vinod Nair, Head of Research at Geojit Financial Services, said, “Continued FII inflows, combined with a consolidation in the dollar index, boosted market sentiment. A major next trigger could be the US CPI inflation, to be announced tomorrow, consensus indicates a moderation to 7.9% in October compared to 8.2% in Septmber. A fast slowdown in inflation would provide the fuel for the market to edge higher, the key problem of 2022.”

That said, here’s a look at what some key indicators are suggesting for Thursday’s action:

US market
US stock indexes fell on Wednesday as uncertainty around the outcome of a tightly contested midterm election weighed on the mood, with investor focus shifting to Thursday’s inflation data for clues on the path of future interest rate hikes.

Republicans made modest gains and were favoured to win control of the House of Representatives, though control of the US Senate may once again be decided in December 6 runoff elections in Georgia. Many of the most competitive races were too close to call.

Wall Street's main indexes have sold off sharply this year, with the benchmark S&P 500 down 20.3% year-to-date on worries that the aggressive rate hikes could cause a recession.

At 10:09 am ET, the Dow Jones Industrial Average was down 163.81 points, or 0.49%, at 32,997.02, the S&P 500 was down 18.93 points, or 0.49%, at 3,809.18, and the Nasdaq Composite was down 80.39 points, or 0.76%, at 10,535.81.

Nine of the 11 major S&P sectors declined in early trading, led by a 1.7% slide in energy and 1.1% in technology .

Meta Platforms climbed 8% as the Facebook-parent said it would let go of 13% of its workforce, or more than 11,000 employees, in one of the biggest tech layoffs this year.

Declining issues outnumbered advancers for a 2.09-to-1 ratio on the NYSE and for a 2.09-to-1 ratio on the Nasdaq. The S&P index recorded five new 52-week highs and 13 new lows, while the Nasdaq recorded 22 new highs and 209 new lows.

European shares
European shares came off eight-week highs Wednesday as Marks & Spencer led declines among retailers, while investors closely tracked results from the US midterm election to determine a shift in the balance of power in Washington.

The pan-European STOXX 600 index fell 0.6% by 0930 GMT, with the retail sector index down 1.1%.

Britain's Marks & Spencer slipped 3.6%, down the most on the sector index, as it warned of a “gathering storm” of higher costs and pressure on household budgets.

European stock markets eyed their fourth straight week of gains and started the month on solid ground, driven by better-than-feared corporate earnings and hopes the Fed will deliver rate hikes in smaller increments.

Among other stocks, Germany's Commerzbank shed 5.2%, weighing down the banks index by 0.9%.

Tech View: Long bear candle
A long bear candle was formed on the daily chart at the swing high of 18,296 levels, which indicates an inability of bulls to sustain the highs. After sustaining above the hurdle of around 18,175 levels on Monday, the market failed to sustain above this hurdle on Wednesday and closed below it towards the end.

Stocks showing bullish bias
Momentum indicator Moving Average Convergence Divergence (MACD) showed a bullish trend in the counters of Samvardhana Motherson, Brighcom Group, Aegis Logistics, Foods and Inns and Jubilant Ingrevia among others.

The MACD is known for signaling trend reversals in traded securities or indices. When the 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 signalling weakness ahead
The MACD showed bearish signs on the counters of ICICI Bank, Infosys, Tech Mahindra, Paisalo Digital and Granules India among others. Bearish crossover on the MACD on these counters indicated that they have just begun their downward journey.

Most active stocks in value term
Adani Ports SEZ (Rs 1,781 crore), Adani Enterprises (Rs 1,495 crore), RIL ((Rs 135 crore), and PI Industries (Rs 1,351 crore) were among the most active stocks on NSE in value terms. Higher activity on a counter in value terms can help identify the counters with highest trading turnovers in the day.

Most active stocks in volume terms
PNB ( Shares traded: 29.92 crore), Vodafone Idea (Shares traded: 12.27 crore), Zomato (Shares traded: 8.74 crore), Yes Bank (Shares traded: 8.52 crore) and Union Bank (Shares traded: 8.36 crore) were among the most traded stocks in the session on the NSE.

Stocks showing buying interest
Shares of PI Industries, Union Bank of India, Bank of Baroda, PNB, BLS International among others witnessed strong buying interest from market participants as they scaled their fresh 52-week highs, signaling bullish sentiment.

Stocks seeing selling pressure
Shares of Indigo Paints, Divis Labs and Medplus Health witnessed strong selling pressure and hit its 52-week lows, signaling bearish sentiment on the counters.

Sentiment meter favours bears
Overall, market breadth favoured losers as 1,683 stocks ended in the green, while 1,837 names ended in the red.

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