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Indian markets could open flat to mildly lower, in line with muted trading in Asia today and despite negative US markets on Tuesday..… -  HDFC Securities

U.S. stocks closed lower Tuesday, with the S&P 500 index and Nasdaq Composite pulling back from record levels, as investors took little notice of economic data with the two-day Federal Reserve policy meeting underway and the outcome expected Wednesday evening US time. The U.S. May producer-price index rose 0.8% in May, pushing prices up 6.6% year over year. Separately, retail sales dropped 1.3% in May. While retail sales fell more than expected in May, a look under the hood of the data shows spending is showing signs of rotating back to services, which is supportive of the notion of a broader reopening of the economy.

The New York Fed’s Empire State factory index fell to 17.4 in June from 24.3 a month earlier. Separately, the Federal Reserve said industrial production rebounded 0.8% in May due to a strong gain in auto production. The National Association of Home Builders’ monthly confidence index slipped to 81 in June from 83 in May. That’s the lowest level in nine months.

The US Fed is not expected to announce any plans to ease back on its bond purchases until August, but investors are looking for any indication the Fed has begun discussing such an exit. Nearly 60% of economists in a Reuters poll expect a taper announcement will come in the next quarter, despite a patchy recovery in the job market.

India’s Trade deficit narrowed to $6.3 billion in May from $15.1 billion in April, according to data released on Tuesday by the Ministry of Commerce and Industry. Merchandise exports rose to 32.3 billion in May compared to $30.6 billion in April, a rise of 5.4% month-on-month. Merchandise imports fell to $38.6 billion in May from $45.7 billion in April, a fall of 15.7% month-onmonth basis.

Asian stocks saw a muted start Wednesday after their U.S. peers retreated from all-time highs, with investors awaiting a policy decision from the Federal Reserve.

Indian benchmark equity indices rose for the fourth consecutive session on June 15. The Nifty opened gap up and then remained in a narrow 46 point gap through the day. At close, the Nifty was up 57.40 points or 0.36% at 15869.30.

Indian markets on June 15 ignored the high inflation numbers announced the previous day. Attention and funds are being diverted to the four IPOs lined up this week. This is also reflected in lower volumes. Rangebound trade at these high levels suggest hesitation on the part of traders to expand their commitments in the secondary markets. However a positive outcome from the US Fed meeting this evening could help overcome this hesitation. Nifty could remain in the 15940- 15791 band for the near term.

Daily Technical View on Nifty

Nifty : Post Gap-Up Indecision

Nifty opened with a gap of more than 50 points on 15th Jun, made a fresh all time high 15901 odd levels. Nifty failed to find momentum post gap up and consolidated through out the day Close of the Nifty was not that convincing as bulls lost the strength at higher levels. Nifty ended up with “Doji” candlestick pattern on the daily chart, which indicates indecision for the short term For continuation of an uptrend, Nifty has to surpass yesterday’s high of 15901. Gap down opening below 15823 and sustainable levels below that could end up forming bearish “Island Reversal” pattern on the daily chart of Nifty. However for bearish confirmation, we need to wait till today’s close. Any level above 15901 could extend the rally towards 16000-16100 in Nifty. Bank Nifty closed relatively strong with the help of private banking stocks. From the sectors FMCG, IT and Metals looks the strongest for the day.

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