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

Indian equity benchmarks ended higher for the fourth consecutive session even as global markets turned cautious. Further, RBI annual report for 2023 released on Tuesday suggested that though global outlook remains uncertain, India remains in an advantageous position. At the close, Nifty ended 0.2% higher at 18,633 odd levels.

Sensex rose 123 points on Tuesday helped by FII inflows and firm Asian markets. Gains in financial, banking, capital goods and industrial shares helped the key indices close in the green in a range bound trade.

Here's how analysts read the market pulse:

“The domestic market continued its rally as recent Q4 results indicated improvement in demand. Further, expectations of a normal monsoon and drop in international commodity prices support a rise in the margin profile. The underlying trend is strong, supported by strong liquidity, the negative slope of the interest yield, and the forecast of strong QoQ growth in Q4 FY23 GDP vs. 4.4% in Q3,” said Vinod Nair, Head of Research at Geojit Financial Services.

“Overall, the uptrend is intact and this consolidation shall provide an opportunity for initiating fresh long positions. In terms of levels, 18705 – 18735 shall act as the immediate hurdle zone while 18570 – 18500 is the crucial support zone from a short-term perspective,” said Jatin Gedia, Technical Research Analyst, Sharekhan by BNP Paribas.

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

US market
The Nasdaq led gains among Wall Street's main indexes on Tuesday, boosted by shares of Nvidia, amid optimism about lawmakers tentatively agreeing to raise the nation's debt limit to avert a default.

Nvidia Corp jumped 6.2% to a record, as the world's most valuable chipmaker breached $1 trillion in market capitalization for the first time. Shares of heavyweight AI-player Microsoft Corp rose 0.7%. At 10:12 a.m. ET, the Dow Jones Industrial Average was down 109.41 points, or 0.33%, at 32,983.93, the S&P 500 was up 5.84 points, or 0.14%, at 4,211.29, and the Nasdaq Composite was up 72.89 points, or 0.56%, at 13,048.58.

European shares
European stocks slipped on Tuesday, dented by uncertainty on whether Congress will clear a US debt ceiling deal and avert a catastrophic default. The pan-European STOXX 600 index slipped 0.2% by 0716 GMT, with trading activity expected to pick up momentum as the U.S. and the UK markets reopen after a long weekend.

Tech View: Bullish candle
Nifty today formed a bullish candle on the daily charts to give the highest daily close of the last 112 sessions. Now it has to hold above 18550 zones, for an up move towards 18750 and 18888 zones while on the downside support exists at 18550 and 18442 zones, said Chandan Taparia of Motilal Oswal.

Stocks showing bullish bias
Momentum indicator Moving Average Convergence Divergence (MACD) showed bullish trade on the counters of Tata Steel, Marksans Pharma, REC, NTPC and India Cements 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 signaling weakness ahead
The MACD showed bearish signs on the counters of Samvardhana Motherson, Stove Kraft, DLF, Apollo Hospitals and GMDC, among others. Bearish crossover on the MACD on these counters indicated that they have just begun their downward journey.

Most active stocks in value terms
HDFC Bank (Rs 3033 crore), RIL (Rs 1322 crore), ICICI Bank (Rs 1753 crore), Kotak Bank (Rs 1463 crore), and HDFC (Rs 1089 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
Suzlon Energy (Shares traded: 29.40 crore),Reliance Power (Shares traded: 10.98 crore), YES Bank (Shares traded: 7.79 crore), Zomato (Shares traded: 6.07 crore) and Ujjivan SFB(Rs 5.11 crore) among the most traded stocks in the session on NSE.

Stocks showing buying interest
Shares of Jindal Saw, Syrma SGS Technology, Ujjivan SFB and AIA Engineering witnessed strong buying interest from market participants as they scaled their fresh 52-week highs, signaling bullish sentiment.

Stocks seeing selling pressure
Shares of GRM Overseas, Zee Media, Viji Finance and Omkar Speciality among others hit their 52-week lows, signaling bearish sentiment on the counters.

Sentiment meter favours bears
Overall, market breadth favoured bears as 1,631 stocks ended in the green, while 1874 names settled with losses.

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