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

Amid positive global cues, Indian equity benchmarks snapped a 2-day losing streak and ended higher.Nifty settled with gains of 91 points at 18,118, while Sensex climbed 320 points to 60,941 levels. Sectorally, buying was seen across sectors, except for Realty and metals.

Here's how analysts read the market pulse:

“Nifty traded in a range bound manner on January 23; however the overall structure shows that the index is preparing to start the next leg on the upside. On the daily chart, it has started forming higher top higher bottom & once the swing high of 18,184 is crossed, one can initiate a fresh long position. The daily upper Bollinger Band is set for an expansion, which will create room for the price action on the higher side. In the short term, Nifty is expected to surpass the key hurdle zone of 18,260-18,300 & head towards 18,500. On the other hand, the level of 18,000 will provide cushion on the downside,” said Gaurav Ratnaparkhi, Head of Technical Research, Sharekhan by BNP Paribas.

“Market breadth tilted in favour of bulls lifted by financial stocks, amid positive cues from global peers. Strong corporate earnings reported by banks boosted appetite for financial stocks. Positive global markets owing to possibility of a less aggressive rate hike, further added colour,” Vinod Nair, Head of Research at Geojit Financial Services, said.

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

US market
US stock indexes rose on Monday as gains in shares of chipmakers helped ease pressure on the battered technology sector at the start of another big week for corporate earnings. Investors are eyeing results from Microsoft Corp, Tesla Inc, IBM and Intel this week to see how their businesses are coping with the threat of an economic slowdown triggered by the Federal Reserve's aggressive policy tightening.

Six of the 11 major S&P 500 sector indexes were up in early trading, with a 1.3% rise in tech stocks making them the biggest gainers. Although recent data has signaled cooling inflation, a tight labor market may keep the central bank on its aggressive policy tightening path until rates rise over 5%, a level backed by most policymakers.

At 10:04 am ET the Dow Jones Industrial Average was up 76.08 points, or 0.23%, at 33,451.57, the S&P 500 was up 23.24 points, or 0.59%, at 3,995.85 and the Nasdaq Composite was up 117.16 points, or 1.05%, at 11,257.59.

European shares
European stocks edged higher on Monday, lifted by technology and mining shares, as expectations of a mild recession in the euro zone offset hawkish remarks from European Central Bank (ECB) officials that sent the euro to a nine-month high.

The pan-European STOXX 600 index rose 0.2% after posting its first weekly decline of the year on Friday. Tech stocks jumped 1.4% after their Wall Street peers rallied on Friday following upbeat results from streaming giant Netflix Inc. The benchmark STOXX 600 index hit a nine-month high last week as a warm winter in Europe, evidence of moderating inflation and China abandoning its tight COVID-19 rules brightened the outlook for Europe's economy.

Tech View: Doji candle
Nifty on the daily charts today formed a Doji candle and closed the day with a gain of around 90 points to close above the 20-DMA. Now, it has to hold above 18,081 zones for an up move towards 18,181 and 18,250 zones whereas supports are placed at 18,018 and 17,950 zones, said Chandan Taparia of Motial Oswal

Stocks showing bullish bias
Momentum indicator Moving Average Convergence Divergence (MACD) showed bullish trade on the counters of GAIL, Bandhan Bank, Nureca, Kotak Mahindra Bank and Torrent Power, among others.

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 signaling weakness ahead
The MACD showed bearish signs on the counters of Ircon International, Usha Martin, UltraTech Cement, Rain Industries and Aptech, among others. Bearish crossover on the MACD on these counters indicated that they have just begun their downward journey.

Most active stocks in value terms
ICICI Bank (Rs 1,474 crore), Kotak Bank (Rs 1,386 crore), HDFC Bank (Rs 1,293 crore) and RIL (Rs 1,234 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
Yes Bank (Shares traded: 46.10 crore), Vodafone Idea (Shares traded: 11 crore), Infibeam Avenues (Shares traded: 8.92 crore), IDFC First Bank (Shares traded: 5.9 crore) and Suzlon Energy (Shares traded: 5.5 crore) were among the most traded stocks in the session on NSE.

Stocks showing buying interest
Shares of IIFL Wealth, Engineers India, Jindal Stainless, IDFC, Adani Gas and Swan Energy witnessed strong buying interest from market participants as they scaled their fresh 52-week highs, signaling bullish sentiment.

Stocks seeing selling pressure
Shares of Saregama India, Alok Industries, Atul, Clean Science, Relaxo Footwear and Vodafone Idea among others hit their 52-week lows, signaling bearish sentiment on the counters.

Sentiment meter favours bears
Overall, market breadth favoured bears as 1,977 stocks ended in the red while 1,666 names settled with gains.

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