Ahead of Market: 10 things that will decide stock market action on Friday
Indian markets ended higher after Sensex and Nifty reversed losses during the closing auction, snapping a three-session decline. Crude above $102, weak global cues and rising yields kept sentiment cautious, while Nifty formed a hammer and stocks s...
By Debaroti Adhikary, ETMarkets.com | Updated:
ETMarkets.com
The Indian stock market closed in the green on Thursday, with Sensex and Nifty reversing all intraday losses during the closing auction session (CAS) to snap a three-session losing streak even as oil prices remained elevated above $102 per barrel.
Sensex gained 138 points to close at 74,903 on its weekly expiry day, while Nifty 50 gained 46 points to end the session at 23,478. Notably, both the benchmark indices were trading in the red before the CAS, during which they reversed all losses to swing into the green.
Here's how analysts read the market pulse
While Dalal Street took a sigh of relief, caution is warranted. The prospect of synchronized monetary tightening strengthened as higher crude prices and prolonged geopolitical tensions reinforced energy-led inflation concerns, said Vinod Nair, Head of Research at Geojit Investments. He added that investors now await key US inflation data for cues on the rate trajectory. Meanwhile, rising global bond yields, coupled with concerns over a potential yen carry trade unwind amid expectations of a BOJ rate hike and a stronger yen, are likely to keep capital flows into emerging markets under pressure.
The domestic market endured a choppy session on expiry day amid weak Asian cues, as investor focus remained closely tethered to the volatility in crude prices, he said. “Although the strong August equity fund flow data and the moderation in the SIP stoppage ratio lent support to the markets, sentiment was tempered by the depreciating rupee and firming domestic bond yields,” according to the analyst.
US stocks
Wall Street's main indexes tumbled early Thursday as oil prices remained above $100 a barrel, while traders digested an uptick in US wholesale inflation driven by steeper energy costs.
The shift came after US government data showed a year-on-year acceleration in the Producer Price Index (PPI) to 5.4 percent in August, more than the 5.3 percent that analysts expected.
On a month-on-month basis, PPI was up 0.4 percent. A key driver behind the increase was energy costs, with diesel prices jumping 24.1 percent in the month.
The yield on the 30-year Treasury bond climbed to 5.35 percent, the highest level since 2007, after the latest inflation data.
Meanwhile, the price of Brent crude stood around $105 per barrel while West Texas Intermediate hovered at about $100 per barrel.
European markets
European shares fell to near two-month lows on Thursday as expectations of further interest rate hikes grew after the European Central Bank increased borrowing costs and warned of higher inflation due to war-driven energy shock.
The pan-European STOXX 600 was down 0.5% at 637.73 points, as of 1339 GMT, with most major regional markets trading in the red.
The ECB raised interest rates by 25 basis points to 2.5% on Thursday, its second increase this year, as policymakers sought to ensure a rise in energy prices stemming from the U.S.-Israeli war on Iran does not spread through the euro zone economy.
Tech view on Nifty
The Nifty closed higher as the CAS closing came high following a lacklustre session, said Rupak De, Senior Technical Analyst at LKP Securities. He explained that on the daily timeframe, the index has formed a hammer pattern, suggesting a pause in the recent bearish trend.
“On the lower end, immediate support is placed in the 23,380–23,400 zone. On the higher end, resistance is placed at 23,550–23,600. A sustained move above 23,600 could extend the recovery towards 23,800,” the analyst said.
Most active stocks in terms of turnover
HDFC Bank (Rs 1,871 crore), Swan Energy (Rs 1,616 crore), ICICI Bank (Rs 1,454 crore), Vodafone Idea (Rs 1,347 crore), Ather Energy (Rs 1,324 crore), RIL (Rs 1,183 crore) and Welspun Corp (Rs 1,168 crore) were among the most active stocks on NSE in value terms. Higher activity in a counter in value terms can help identify the counters with the highest trading turnovers in the day.
Most active stocks in volume terms
Vodafone Idea (Traded shares: 88.84 crore), Ola Electric (Traded shares: 18.08 crore), IFCI (Traded shares: 10.62 crore), IRB Infra Developers (Traded shares: 7.87 crore), Swan Energy (Traded shares: 5.31 crore), Yes Bank (Traded shares: 4.8 crore) and Suzlon Energy (Traded shares: 4.37 crore) were among the most actively traded stocks in volume terms on NSE.
Stocks showing buying interest
Swan Energy, Ami Organics, Welspun Corp, KEC International, Ather Energy, Ola Electric and Finolex Cables were among the stocks that witnessed strong buying interest from market participants.
52-week high
Among the ones which hit their 52-week highs on NSE included Welspun Corp, Finolex Cables, Redington, Jindal Saw, Chennai Petro, Craftsman Automation and Lenskart Solutions.
Stocks seeing selling pressure
Stocks which witnessed significant selling pressure were Zee Entertainment Enterprises, Sail Life Sciences, HEG, HFCL, Afcons Infrastructure, Tejas Networks and IFCI.
52-week low
Among the ones which hit their 52-week lows on NSE included HEG, IndiaMart, Pfizer, Britannia Industries, PI Industries, Bikaji Foods International and ICICI Lombard.
Sentiment meter favours bears
Out of the 3,676 stocks that traded on the NSE on September 10, Thursday, 1,466 stocks witnessed advances, 2,079 stocks saw declines while 121 stocks remained unchanged.
This article has been written by Debaroti Adhikary, who is not a SEBI-registered Research Analyst or an Investment Adviser. Debaroti Adhikary and his/her ‘relative(s)’ (as defined under Section 2(77) of the Companies Act, 2013) do not hold any financial interest in the companies mentioned in this article as of the date of publication. The views/recommendations mentioned in this article, wherever applicable, are those of the respective SEBI-registered Research Analyst/brokerage and have been reproduced/reported with due attribution. They should not be construed as the views or recommendations of The Economic Times Digital or the journalist. Readers are advised to consider the original research report and make their investment decisions based on their own assessment. Brokerage disclaimers here.
Sensex gained 138 points to close at 74,903 on its weekly expiry day, while Nifty 50 gained 46 points to end the session at 23,478. Notably, both the benchmark indices were trading in the red before the CAS, during which they reversed all losses to swing into the green.
Here's how analysts read the market pulse
While Dalal Street took a sigh of relief, caution is warranted. The prospect of synchronized monetary tightening strengthened as higher crude prices and prolonged geopolitical tensions reinforced energy-led inflation concerns, said Vinod Nair, Head of Research at Geojit Investments. He added that investors now await key US inflation data for cues on the rate trajectory. Meanwhile, rising global bond yields, coupled with concerns over a potential yen carry trade unwind amid expectations of a BOJ rate hike and a stronger yen, are likely to keep capital flows into emerging markets under pressure.
The domestic market endured a choppy session on expiry day amid weak Asian cues, as investor focus remained closely tethered to the volatility in crude prices, he said. “Although the strong August equity fund flow data and the moderation in the SIP stoppage ratio lent support to the markets, sentiment was tempered by the depreciating rupee and firming domestic bond yields,” according to the analyst.
US stocks
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Wall Street's main indexes tumbled early Thursday as oil prices remained above $100 a barrel, while traders digested an uptick in US wholesale inflation driven by steeper energy costs.
The shift came after US government data showed a year-on-year acceleration in the Producer Price Index (PPI) to 5.4 percent in August, more than the 5.3 percent that analysts expected.
On a month-on-month basis, PPI was up 0.4 percent. A key driver behind the increase was energy costs, with diesel prices jumping 24.1 percent in the month.
The yield on the 30-year Treasury bond climbed to 5.35 percent, the highest level since 2007, after the latest inflation data.
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Meanwhile, the price of Brent crude stood around $105 per barrel while West Texas Intermediate hovered at about $100 per barrel.
European markets
ADVERTISEMENT
European shares fell to near two-month lows on Thursday as expectations of further interest rate hikes grew after the European Central Bank increased borrowing costs and warned of higher inflation due to war-driven energy shock.
The pan-European STOXX 600 was down 0.5% at 637.73 points, as of 1339 GMT, with most major regional markets trading in the red.
The ECB raised interest rates by 25 basis points to 2.5% on Thursday, its second increase this year, as policymakers sought to ensure a rise in energy prices stemming from the U.S.-Israeli war on Iran does not spread through the euro zone economy.
Tech view on Nifty
The Nifty closed higher as the CAS closing came high following a lacklustre session, said Rupak De, Senior Technical Analyst at LKP Securities. He explained that on the daily timeframe, the index has formed a hammer pattern, suggesting a pause in the recent bearish trend.
“On the lower end, immediate support is placed in the 23,380–23,400 zone. On the higher end, resistance is placed at 23,550–23,600. A sustained move above 23,600 could extend the recovery towards 23,800,” the analyst said.
Most active stocks in terms of turnover
HDFC Bank (Rs 1,871 crore), Swan Energy (Rs 1,616 crore), ICICI Bank (Rs 1,454 crore), Vodafone Idea (Rs 1,347 crore), Ather Energy (Rs 1,324 crore), RIL (Rs 1,183 crore) and Welspun Corp (Rs 1,168 crore) were among the most active stocks on NSE in value terms. Higher activity in a counter in value terms can help identify the counters with the highest trading turnovers in the day.
Most active stocks in volume terms
Vodafone Idea (Traded shares: 88.84 crore), Ola Electric (Traded shares: 18.08 crore), IFCI (Traded shares: 10.62 crore), IRB Infra Developers (Traded shares: 7.87 crore), Swan Energy (Traded shares: 5.31 crore), Yes Bank (Traded shares: 4.8 crore) and Suzlon Energy (Traded shares: 4.37 crore) were among the most actively traded stocks in volume terms on NSE.
Stocks showing buying interest
Swan Energy, Ami Organics, Welspun Corp, KEC International, Ather Energy, Ola Electric and Finolex Cables were among the stocks that witnessed strong buying interest from market participants.
52-week high
Among the ones which hit their 52-week highs on NSE included Welspun Corp, Finolex Cables, Redington, Jindal Saw, Chennai Petro, Craftsman Automation and Lenskart Solutions.
Stocks seeing selling pressure
Stocks which witnessed significant selling pressure were Zee Entertainment Enterprises, Sail Life Sciences, HEG, HFCL, Afcons Infrastructure, Tejas Networks and IFCI.
52-week low
Among the ones which hit their 52-week lows on NSE included HEG, IndiaMart, Pfizer, Britannia Industries, PI Industries, Bikaji Foods International and ICICI Lombard.
Sentiment meter favours bears
Out of the 3,676 stocks that traded on the NSE on September 10, Thursday, 1,466 stocks witnessed advances, 2,079 stocks saw declines while 121 stocks remained unchanged.
This article has been written by Debaroti Adhikary, who is not a SEBI-registered Research Analyst or an Investment Adviser. Debaroti Adhikary and his/her ‘relative(s)’ (as defined under Section 2(77) of the Companies Act, 2013) do not hold any financial interest in the companies mentioned in this article as of the date of publication. The views/recommendations mentioned in this article, wherever applicable, are those of the respective SEBI-registered Research Analyst/brokerage and have been reproduced/reported with due attribution. They should not be construed as the views or recommendations of The Economic Times Digital or the journalist. Readers are advised to consider the original research report and make their investment decisions based on their own assessment. Brokerage disclaimers here.
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