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

Here's how analysts read the market pulse:

Ruchit Jain, Lead Research, 5paisa.com, said in case of any declines, the immediate support for Nifty will be seen around the hourly 20-EMA near 16,220. On the flipside, the near-term upside for Nifty is seen around the 16,550-16,650 range, where we could see a confluence of resistances, he said.

Ajit Mishra, VP - Research, Religare Broking, said the recent bounce in laggards like IT and metal has further eased the pressure. "We maintain our positive yet cautious stance and prefer sectors like auto, FMCG and banking for long opportunities."

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

Stocks rally as US earnings pick up
A global gauge of stocks climbed on Tuesday as equities rallied while the dollar was down for a third straight day as the door was opened for the European Central Bank to enact a bigger rate hike than expected this week.

Stocks on Wall Street advanced in broad rally, joining their European counterparts, with each of the 11 major S&P sectors climbing as the U.S. corporate earnings season heats up.
Johnson & Johnson shares gained 0.20% after posting results that beat expectations but cut its full-year outlook, citing a stronger dollar.

The Dow Jones Industrial Average rose 522.31 points, or 1.68%, to 31,594.92; the S&P 500 gained 74.31 points, or 1.94%, to 3,905.16; and the Nasdaq Composite added 241.99 points, or 2.13%, to 11,602.04.

European markets close higher
European stocks closed sharply higher Tuesday, with a late afternoon surge aided by positive momentum on Wall Street.

The pan-European STOXX 600 index rose 1.47% and MSCI's gauge of stocks across the globe gained 1.56%.

A Reuters report that the European Central Bank (ECB) was weighing a 50 basis points rate hike at its Thursday meeting, bigger than the 25 basis points hike many market participants had priced in, helped put the euro on track for its biggest one-day percentage gain in nearly two months.

Tech View: Bullish candle
Nifty50 on Tuesday formed a bullish candle on the daily chart, and if one goes by what analysts say 16,500 level looks a good possibility.

Stocks showing bullish bias
Momentum indicator Moving Average Convergence Divergence (MACD) showed a bullish trade setup on the counters of Sunteck Realty, Ajanta Pharma, Suprajit Engineering, AIA Engineering, HAL and KPIT Tech.

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 Jamna Auto, Strides Shasun, Jubilant FoodWorks, Cadila Healthcare and Crisil.
A bearish crossover on the MACD on these counters indicated that they had just begun their downward journey.

Most active stocks in value terms
RIL (Rs 1,843 crore), HDFC Bank (Rs 1,065 crore), ICICI Bank (Rs 995 crore), Tata Steel (Rs 782 crore), Axis Bank (Rs 708 crore), and Bajaj Finance (Rs 592 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
ONGC (Shares traded: 3.4 crore), ICICI Bank (Shares traded: 1.3 crore), SBI (Shares traded: 1.2 crore), Tata Motors (Shares traded: 1.1 crore), Power Grid (Shares traded: 1.1 crore) and Hindalco (Shares traded: 1 crore) were among the most traded stocks in the session on NSE.

Stocks showing buying interest
Shares of Tube Investments, GE Shipping, Timken India, AIA Engineering, Varun Beverages, M&M Financial 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 NGL Fine-Chem Limited, DRC Systems and Renaissance Global witnessed strong selling pressure and hit their 52-week lows, signalling bearish sentiment on the counters.

Sentiment meter favours bulls
Overall, market breadth favoured winners as 1,975 stocks ended in the green, while 1,337 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)