Ahead of Market: 10 things that will decide D-St action on Tuesday

Amid weak global cues, the Nifty witnessed a steep fall on Monday and closed the day lower by 246 points. Among sectors, Oil & Gas and FMCG ended marginally higher, while IT, Banks, Metals and Realty indices fell the most.

Here's how analysts read the market pulse:

Rupak De, Senior Technical Analyst at LKP Securities, said the momentum oscillator RSI is in a bearish crossover and falling towards the oversold zone. “The short-term trend, at the juncture, looks weak on the lower end, and the index may drift down towards 17,000-16,950 over the short term. On the higher end, resistance is visible at 17,500,” he said.

Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities, said traders are expecting more bouts of volatility in coming sessions on concerns that the continuation of rate hikes in the US could pose a threat to the global economy and hurt growth prospects.

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

Wall Street extends losses
U.S. stock indexes fell on Monday on worries over the Federal Reserve's plan to keep raising interest rates in its fight against inflation even at the cost of an economic slowdown.

At 09:33 a.m. ET, the Dow Jones Industrial Average was down 265.07 points, or 0.82%, at 32,018.33, the S&P 500 was down 29.87 points, or 0.74%, at 4,027.79, and the Nasdaq Composite was down 82.76 points, or 0.68%, at 12,058.95.

Fed Chair Jerome Powell said on Friday that the U.S. economy would need tight monetary policy "for some time" before inflation is under control, knocking Wall Street's main indexes down more than 3%.

European markets lower
European shares dropped on Monday, while bond yields surged as comments from central bank policymakers heightened fears of aggressive measures to stamp out inflation amid rising risks of a recession.

The STOXX 600 index fell 0.9% to a more than one-month low, with interest rate-sensitive tech stocks tumbling 1.8%. Germany's 10-year yield rose 10 basis points (bps) to a two-month high.

Tech View: More weakness in the offing
Nifty50 did not respect its 20-day simple moving average (SMA) but somehow managed to form a bullish candle on the daily chart, post a gap-down opening, reflecting intraday recovery. Some analysts believe more weakness is in the offing.

Stocks showing bullish bias
Momentum indicator Moving Average Convergence Divergence (MACD) showed a bullish trade setup on the counters of Hathway Cable & Data, NHPC, GAIL, Jindal Steel and Power, Jubilant Foodworks and Praj Industries.

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 Adani Power, ACC, WABCO India, Fortis Healthcare, RIL and Prism Johnson.

A 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 2,394 crore), Infosys (Rs 1,178 crore), TCS (Rs 793 crore), Bajaj Finance (Rs 693 crore), Kotak Bank (Rs 676 crore), and ICICI Bank (Rs 664 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 the highest trading turnovers in the day.

Most active stocks in volume terms
Tata Steel (Shares traded: 6 crore), Wipro (Shares traded: 1.2 crore), Tata Motors (Shares traded: 1.2 crore), ITC (Shares traded: 1 crore), NTPC (Shares traded: 1.1 crore) and SBI (Shares traded: 0.9 crore) were among the most traded stocks in the session on NSE.

Stocks showing buying interest
Shares of Mazagon Dock, Aegis Logistics, Escorts, Cochin Shipyard, Ratnamani Metal and Adani Transmission witnessed strong buying interest from market participants as they scaled their fresh 52-week highs, signalling bullish sentiment.

Stocks seeing selling pressure
Shares of Mphasis, Shilpa Medicare, Birlasoft, Thyrocare, Sanofi India and Biocon were among those that witnessed strong selling pressure and hit their 52-week lows, signalling bearish sentiment on the counters.

Sentiment meter favours bears
Overall, market breadth favoured losers as 1,403 stocks ended in the green, while 2,106 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)