Ahead of Market: 12 things that will decide D-St action on Friday

New Delhi: Benchmark indices surged on Thursday after the US Fed signals that it may go slow on interest rate hikes, following a 75 basis points rate hike overnight. Strong quarterly earnings added to the Street optimism.

Here's how analysts reaad the market pulse:

Gaurav Ratnaparkhi of Sharekhan said that the bulls maintained the upper hand throughout the day, adding that the 16,750-16,800 range has become a near-term support zone.

"As long as the index trades above this zone, it can continue to march higher towards 17,000, where there is 61.8 per cent retracement of the April–June decline and the 200-DMA. If the bulls manage to take out the level of 17,000, the index can stretch towards 17,200 in the short term," Ratnaparkhi said.

Mazhar Mohammad of Chartviewindia.in said that a follow-through is needed in the next couple of sessions, without violating 16,746 levels on a closing basis.

"In that scenario, an initial hurdle can be its 200-SMA, whose value is present at around 17,030 levels. If the index manages to sustain above the said hurdle then, eventually, higher targets towards 17,500 cannot be ruled out," he said.

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

US stocks decline on GDP report
Stocks are falling early on Thursday as investors reacted to news that the U.S. economy shrank for a second consecutive quarter, sharply raising rears that the U.S. economy is already in or is heading for a recession. The S&P 500 was down 0.4% as of 10 a.m. Eastern, the Dow Jones Industrial Average dropped 0.4%, and the technology-heavy Nasdaq Composite was down 0.6%.

The U.S. economy shrank from April through June, contracting at a 0.9% annual pace.

European stocks close higher
European markets closed higher on Thursday as global investors digested a slew of earnings, new economic data and some slightly less hawkish messaging from the US Federal Reserve.

The pan-European Stoxx 600 closed up 1% provisionally, with most sectors and major indexes pointing in positive territory. Financial services stocks led the gains, climbing 2.8%.

Tech View: Nifty may test 17K
Nifty50 on Thursday made an upside breakout, as the index closed above 16,900, breaching a slew of strong resistance hurdles. The index made a gap-up start and still ended up forming a strong bullish candle on the daily scale. Analysts said the support has shifted higher and that the index may now set eye on the 200-day simple moving average, whose value is placed just above the 17,000 level.

F&O: Support shifts higher
On the options front, maximum Call open interest (OI) is at 17,000, followed by the 17,500 strike. The maximum Put OI is at 16,500, followed by the 16,000 strike. Marginal Call writing is seen at 16,800 and 17,000 strikes while Put writing is seen at 16,500 and 16,700 strikes. Option data suggests a wider trading range in between 16,400 to 17,000 zones, said Chandan Taparia of Motilal Oswal Securities.

Stocks showing bullish bias
Momentum indicator Moving Average Convergence Divergence (MACD) showed bullish trade setup on the counters of Gayatri Projects, Paisalo Digital, SBI Life Insurance, Apar Industries, Nippon Life AMC, Novartis and Info Edge (India). 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 Tata Motors, Tata Power, Welspun India, United Spirits, VIP Industries, Hindustan Unilever and Petronet LNG, among others. A bearish crossover on the MACD on these counters indicated that they have just begun their downward journey.

Most active stocks in value terms
Bajaj Finance (Rs 2,779 crore), Bajaj Finserv (Rs 1,299 crore), Tata Motors (Rs 1,104 crore), Tata Steel (Rs 1,103 crore), Reliance Industries (Rs 682 crore), Zomato (Rs 645 crore), HDFC Bank (Rs 570 crore), ICICI Bank (Rs 449 crore) and IndusInd Bank (Rs 421 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
Zomato lead the stock in terms of volumes, followed by Tata Steel, YES Bank, Suzlon Energy, PNB, Vodafone Idea, Tata Motors and IDFC First Bank. These stocks were among the most traded stocks in the session on NSE.

Stocks showing buying interest
Blue Dart, Federal Bank, GHCL, Adani Enterprises, Indian Hotels, Motherson Sumi Wiring, Cummins India, SKF India, Coal India, Adani Transmission and Bank of Baroda as they scaled their fresh 52-week highs, signalling bullish sentiment.

Stocks seeing selling pressure
Sanofi, Policy Bazaar, Alembic Pharma, Pfizer, Indigo Paints, Gland Pharma and Medplus Health Services witnessed strong selling pressure and hit their 52-week lows, signaling bearish sentiment on the counters.

Sentiment meter favours bulls
Overall, the market breadth favoured the bulls, as 1,902 stocks ended in the red, while 1,427 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)