Ahead of Market: 10 things that will decide stock market action on Wednesday

The Indian stock market sharply reversed all morning losses to close in the deep red on Tuesday, with benchmark indices Sensex and Nifty tumbling more than 1% each, as surging bond yields, climbing oil prices, and a wave of global uncertainty rattled investor sentiment.

The Sensex plunged nearly 1,433 points from its day's high to close at 74,004, while the Nifty 50 tumbled over 474 points from its day’s high to end the session at 23,119. The reversal marks a nearly 2% intraday drop for the benchmark indices.

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Here's how analysts read the market pulse

Domestic markets remained under pressure, extending their recent correction as elevated crude oil prices and rising global bond yields weighed on sentiment, said Vinod Nair, Head of Research, Geojit Investments. He added that investors stayed cautious ahead of key central bank meetings this week, with growing expectations of further policy tightening by major economies.

Concerns about a prolonged high-interest-rate environment, particularly in the US, kept Treasury yields near multi-year highs and continued to dampen emerging market sentiment amid persistent foreign outflows, he said, adding that mid- and small-cap stocks lagged benchmark indices, while most sectors closed sharply lower.

“However, IT stocks outperformed as comments suggesting slower AI development eased concerns over the rapid disruption of traditional IT services. In the near term, sustained high oil prices and elevated bond yields may continue to pressure risk appetite, though strong domestic fundamentals and value buying by local investors could help contain downside risks,” the analyst noted.

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US stocks

Wall Street's main indexes edged lower on Tuesday, dragged down by higher crude prices, elevated Treasury yields and an uncertain outlook for AI demand that kept investors at bay.

Chipmakers, which bore the brunt of Monday's selloff, rose but sentiment toward other Big Tech stocks was mixed.

The latest bout of anxiety was driven by calls from top AI companies to slow the development of the technology, citing safety concerns.

Meanwhile, the Federal Reserve is expected to raise interest rates, with traders pricing in a 93% chance of a hike on Wednesday.

The Middle East conflict has shown few signs of easing, keeping oil prices elevated and deepening concerns of a supply shock.

European markets

Europe's STOXX 600 was down 0.10%, after hitting 629.41, its lowest level since June 12. The European tech stock index rose 0.10%, after shedding more than 2% on Monday.

German Bund yields, the euro area's benchmark, rose to their highest level in over 17 years at 3.56%, as traders boosted bets on European Central Bank rate hikes, with a depo rate seen at 3.45% at the end of 2027, from the current 2.50%.

Tech view on Nifty

Nifty on the daily chart formed a sizable bearish candle with a higher high and a lower low, said Pabitro Mukherjee, Deputy Vice President-Research at Bajaj Broking. He noted that the index opened higher but failed to sustain at higher levels and gave up its entire gains to close deep in the red. Nifty in the process breached its last week low of 23,231 highlighting continuation of the downward bias.

“Going ahead, bias remains down below 23,600 levels being the Monday’s high and last week breakdown area. A follow through weakness will open downside towards 23,000 and 22,800 levels in the coming sessions. Only a formation of higher high and higher low on a sustained basis in the daily chart and a move above 23,600 will signal a pause in the current down trend,” he added.

Most active stocks in terms of turnover

HDFC Bank (Rs 3,642 crore), Solar Industries (Rs 2,631 crore), Zensar Tech (Rs 1,939 crore), Tata Investment Corp (Rs 1,773 crore), RIL (Rs 1,718 crore), Infosys (Rs 1,605 crore) and ICICI Bank (Rs 1,376 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: 36.87 crore), Yes Bank (Traded shares: 9.54 crore), IFCI (Traded shares: 8.12 crore), Pine Labs (Traded shares: 6.28 crore), Ola Electric (Traded shares: 6.1 crore), Groww (Traded shares: 5.33 crore) and HDFC Bank (Traded shares: 5.04 crore) were among the most actively traded stocks in volume terms on NSE.

Stocks showing buying interest

Tata Chemicals, Firstsource, Tata Investment Corp, Sonata Software, ACME Solar Holdings, Hexaware Technologies and HCLTech 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 Granules India and Solar Industries.

Stocks seeing selling pressure

Stocks which witnessed significant selling pressure were Solar Industries, Welspun Corp, Data Patterns, Netweb Technologies, Jindal Saw, Caplin Point and GE T&D India.

52-week low

Among the ones which hit their 52-week lows on NSE included HEG, Commercial Engg, Max Financial, Motherson Sumi Wiring, IRCON International, GIC and India Cements.

Sentiment meter favours bears

Out of the 3,687 stocks that traded on the NSE on September 15, Tuesday, 754 stocks witnessed advances, 2,824 stocks saw declines while 109 stocks remained unchanged.

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Disclaimer: 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.