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Indian markets could open flat to mildly higher, following flat Asian markets today and mildly negative US markets on Tuesday - HDFC Securities

Major U.S. stock benchmarks closed with modest losses Tuesday, after the S&P 500 hit a record intraday high as investors weighed prospects for President Joe Biden’s $2.3 trillion infrastructure plan and a brightening outlook for the U.S. and global economy. Equities teetered between small gains and losses throughout Tuesday, a day after the S&P 500 and Dow closed at records, as investors focused on the prospect of further fiscal support and increased corporate taxes. Volumes on U.S. exchanges slipped below 10 billion shares for the first time this year.

On the data front, job openings in the U.S. jumped to 7.37 million in February from 7.1 million a month earlier, the Labor Department said. That’s the highest level in more than two years. The IMF raised its U.S. outlook sharply in 2021 to 6.4% this year from 5.1%. The U.S. should see solid 4.4% growth in 2022. The IMF raised its estimate for global growth to 6% this year and 4.4% next year. This represents an upgrade of 0.5% for 2021 and 0.2% for 2022 from what it forecast in January.

The U.S. Federal Reserve is expected to release the minutes from its last monetary policy meeting on Wednesday and market participants will parse it for any changes to the central bank's economic outlook. India’s Monetary Policy Committee is likely to maintain a status quo at its meet today

Asia equities are trading flat on Wednesday after Wall Street pulled back from record highs reached in previous sessions, as investors eye the upcoming earnings season for more signs of a recovery following a series of strong U.S. economic data

After a sharp sell-off in the previous session, Indian benchmark equity indices ended marginally higher on April 6 amid some volatile moves. At close, the Nifty was up 45.70 points or 0.31% at 14,683.50.

Nifty has formed an inside day compared to the previous session’s high-low, suggesting no fresh directional clues. The intraday volatility has however become smaller which is a good sign. Greater participation of small and midcaps has resulted in a healthy advance decline ratio. 14574-14876 could be the band for the Nifty for the near term.

IMF ups India’s FY22 GDP growth forecast to 12.5%:

The International Monetary Fund (IMF) raised its FY22 growth forecast for India to 12.5% from 11.5% estimated earlier in January, even as a resurgent Covid spread threatens to undermine the country’s economic recovery. The IMF forecast pitches India as the fastest-growing major economy and the only one expected to record a double-digit recovery from pandemichit 2020. China’s economy is seen growing 8.4% in 2021 and 5.6% in 2022.

Daily Technical View on Nifty

Observation: After witnessing a sharp weakness on Monday, Nifty shifted into a consolidation with volatility on Tuesday and closed the day higher by 45 points. After opening on an upside gap of 100 points (body gap, not a western gap), Nifty started with intraday weakness from the highs in the early part of the session. Upside recovery has witnessed from the lows and Nifty closed the day on an upside recovery note.

A small negative candle was formed with long lower shadow, which indicate a consolidation movement in the market with lower levels buying. The formation of lower shadow in the last two daily candles signal an emergence of buying interest from the lows

The crucial upper resistance of 14880 (resistance as per change in polarity) remains intact and the weakness which started from near the hurdle seems to be halting now. Hence, one may expect Nifty to move up and retest the crucial upper resistance again in the coming sessions.

Nifty on the weekly chart is placed at the weekly 10 period EMA at 14640 and is showing upside recovery from the said support. We observe a broader high low range movement in the Nifty over the last 5-6 weeks around 15300-14300 levels. Hence, the market is within a range and immediate resistance is placed at 14900.

Conclusion: The short term trend of Nifty remains range bound. The market is witnessing an alternative movement of up and down over the last four sessions. As per the present set up, one may expect Nifty to retest the crucial overhead resistance around 14880 levels in the short term, before showing another round of weakness from the highs. A sustainable move above 14900 could open a sharp upside for the market. Immediate support is placed at 14600.

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