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Indian markets could open flat to mildly higher, in line with positive moves in Asian markets today and despite mildly negative US markets on Wednesday - HDFC Securities

U.S. stock benchmarks finished lower, losing steam in the session’s final half-hour, ahead of an eagerly awaited inflation report due Thursday, which could set the tone for the broader financial markets. Dow booked a third day in a row of losses, during a marketwide vigil centered on the prospects for inflation.

A decline of the benchmark 10-year Treasury yield, to its lowest level since March 3, led investors into yield-sensitive assets, including technology stocks, but away from the banking sector. The yield on the 10-year Treasury note was 3.8 basis points lower at 1.489%, its lowest level since March 3.

A May reading of the U.S. consumer-price index due on Thursday morning is expected to be the main event of the week. The headline consumer-price index is expected to rise by an outsized 0.5% in May and 4.8% for the year.

The Union Cabinet has approved an increase in minimum support prices for all mandated kharif crops for marketing season 2021-22 to ensure remunerative prices to growers for their produce. The price hike ranged from 1-6.6% across crops.

Asian shares edged higher but held their recent trading range on Thursday as investors focussed on U.S. inflation data and the risk of an upside surprise that could prompt the Federal Reserve to start tapering its massive stimulus. Markets are looking to the European Central Bank (ECB) policy meeting later in the day where it will likely keep its policy guidance unchanged and publish updated euro area macroeconomic projections.

Indian benchmark equity indices erased early gains on June 09 and ended lower with Nifty below 15,650. At close, the Nifty was down 104.70 points or 0.67% at 15,635.40.

Softer to flatter cues from the global markets and fatigue in the local markets at these high levels resulted in profit taking in Indian markets. The Nifty formed an engulfing top like pattern on daily charts after making a triple top like formation over the last three days in the 15773-15800 band. Advance decline ratio also turned negative after a gap of 5 days. Whether Nifty will show follow through weakness in the days to come will be keenly watched. 15567-15680 is the band for the Nifty in the near term.

Daily Technical View on Nifty

Nifty : Correction in Overall Uptrend

After registering fresh all time high at 15800, Nifty saw sharp correction towards 15566. Nifty breached its 5 days EMA support on closing basis after 14 trading sessions However prevailing levels of Nifty are still above their 10 and 20 days EMA, which indicates the overall uptrend. 14 Days RSI has exited the overbought zone with negative crossover on its signal line. However there was no negative divergence observed yet. The fall seen in yesterday’s session seems to be more like a profit booking in overall bullish trend of the market If Nifty breaks the low of 15566, Correction could be extended towards next support of 15460. Looking at the overall trend buying at lower levels is advisable to traders Resistances for the Nifty are seen at 15680 and15800

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