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

Amid mixed cues, the domestic stock market ended Wednesday with a marginal gain. Following the non-stop surge since the last six days, the Nifty is expected to consolidate. Midcap and smallcap indices ended in the red while Nifty IT index ended 1.35 per cent higher.

Here's how analysts read the market pulse:

Rupak De, Senior Technical Analyst at LKP Securities, said going ahead, a decisive move above 17,400 may induce a further rally in the market. “Failure to move above 17,400 may attract selling pressure in the market. Support on the lower end is visible at 17,200/17,000."

Ajit Mishra, VP - Research, Religare Broking, suggests maintaining focus on identifying stock-specific opportunities and utilizing any dip to accumulate. “At the same time, we recommend keeping a check on leveraged positions and preferring a hedged approach.”

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

Wall Street action
US stock indexes rose on Wednesday on strong results from PayPal and CVS Health, with investors awaiting services activity data for clues on the health of the economy struggling with soaring inflation and tightening financial conditions.

Shares of PayPal Holdings jumped 11.6% after the fintech company raised its annual profit guidance and said activist investor Elliott Management has an over $2 billion stake.

The benchmark S&P 500 index and tech-heavy Nasdaq are up 13.3% and 18.2%, respectively, from the lows hit in mid-June.

European market
Global stocks mostly rose on Wednesday as investor concerns over US-China tensions eased following House Speaker Nancy Pelosi's trip to Taiwan.

London’s FTSE 100 was up 0.3 per cent at 7,434.31 points, Frankfurt’s DAX rose 0.4 per cent to 13,496.38, Paris’ CAC 40 gained 0.7 per cent at 6,453.31, and Euro STOXX 50 was up 0.8 per cent at 3,713.60.

Tech View
A late rebound on Wednesday helped Nifty50 take its winning run to the sixth trading session. The index ended up forming a bullish candle with a long lower-wick, suggesting the bulls are not ready to give in as yet.

Stocks showing bullish bias
Momentum indicator Moving Average Convergence Divergence (MACD) showed bullish trade setup on the counters of Piramal Enterprises, Indian Bank, Ajanta Pharma, Ashok Leyland, TTK Prestige and Torrent Pharma.

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 Solar Industries, Restaurant Brands Asia, Gland Pharma, Mahanagar Gas and Phoenix Mills. Bearish crossover on the MACD on these counters indicated that they have just begun their downward journey.

Most active stocks in value terms
RIL (Rs 1,704 crore), SBI (Rs 1,315 crore), TCS (Rs 962 crore), Infosys (Rs 937 crore), ICICI Bank (Rs 906 crore), and Tata Motors (Rs 892 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: 6.1 crore), SBI (Shares traded: 2.4 crore), Tata Motors (Shares traded: 1.9 crore), ITC (Shares traded: 1.8 crore), ONGC (Shares traded: 1.6 crore) and ICICI Bank (Shares traded: 1.1 crore) were among the most traded stocks in the session on NSE.

Stocks showing buying interest
Shares of Elgi Equipments, CG Power & Industrial Solutions, Adani Transmission, Indian Hotels, Blue Dart, Adani Enterprises and Inox Leisure witnessed strong buying interest from market participants as they scaled their fresh 52-week highs, signaling bullish sentiment.

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

Sentiment meter favours bears

Overall, market breadth favoured losers as 1,326 stocks ended in the green, while 2,026 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)