Ahead of Market: 10 things that will decide stock action on Wednesday

With Nifty scaling past the key hurdle at 17,500 on Monday, bulls are now looking much stronger on Dalal Street. The positive momentum is expected to continue with Nifty eyeing 17,700 – 17,800 zones.


Here's how analysts read the market pulse:

Ajit Mishra, VP - Research, Religare Broking, said Nifty has decisively surpassed the hurdle at 17,400, and is now eyeing 17,800. Apart from the performance of world markets, the last leg of the earnings season coupled with key domestic data like IIP, CPI and WPI would remain on the participants’ radar for cues, he said.


Nagaraj Shetti, Technical Research Analyst, HDFC Securities, said the short-term trend of Nifty remains positive with range bound action. “A sustainable move above 17,550 levels could be considered as an upside breakout of the range and that could pull Nifty towards the next important resistance of 17,800-17,900 levels in the near term. Immediate support is placed at 17,430 levels.”


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

US market
Wall Street futures pointed to slim gains. On Monday, Wall Street closed mostly flat after blockbuster jobs data last week reinforced expectations the Federal Reserve will crack down on inflation, while a revenue warning from chipmaker Nvidia reminded investors of a slowing U.S. economy.

European shares
European shares dipped on Tuesday as investors cautiously waited for key U.S. inflation data later in the week for hints on the Federal Reserve's next move on interest rate increases. The pan-European STOXX 600 index fell 0.3%, retreating after logging its best session in nearly two weeks on Monday.

Tech View
The Nifty50 closed in the green for the second consecutive day on Monday to close above its crucial resistance level of 17,500. It formed a strong bullish candle on the daily charts, suggesting demand at lower levels.

Stocks showing bullish bias
Momentum indicator Moving Average Convergence Divergence (MACD) showed bullish trade setup on the counters of HFCL, Sumitomo Chemical, Tube Investments and Crisil.

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 Sanofi India, Edelweiss Financial, United Breweries, Pfizer, Emami and Central Bank. Bearish crossover on the MACD on these counters indicated that they have just begun their downward journey.

Most active stocks in value terms
SBI (Rs 1,687 crore), RIL (Rs 1,204 crore), HDFC Bank (Rs 1,117 crore), ICICI Bank (Rs 1,1016 crore), Bajaj Finserv (Rs 750 crore), and Bajaj Finance (Rs 704 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
Tata Steel (Shares traded: 4.1 crore), SBI (Shares traded: 3.2 crore), NTPC (Shares traded: 1.7 crore), Coal India (Shares traded: 1.6 crore), ONGC (Shares traded: 1.2 crore) and ICICI Bank (Shares traded: 1.2 crore) were among the most traded stocks in the session on NSE.

Stocks showing buying interest
Shares of Aegis Logistics, HAL, WABCO India, Siemens, Adani Enterprises, M&M and Metro Brands witnessed strong buying interest from market participants as they scaled their fresh 52-week highs, signaling bullish sentiment.

Stocks seeing selling pressure
Shares of Zensar Tech and Alembic Pharma witnessed strong selling pressure and hit their 52-week lows, signaling bearish sentiment on the counters.

Sentiment meter favours bulls
Overall, market breadth favoured losers as 1,894 stocks ended in the green, while 1,613 names settled with cuts.


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