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Indian markets could open lower, in line with mostly lower Asian markets today and sharply lower US markets on Monday - HDFC Securities

U.S. stock benchmarks end lower Monday, with the Dow industrials and Nasdaq each dropping by more than 300 points, as concerns about sticker-than-expected inflation grow on rising oil prices. S&P 500’s communication services sector closed 2.1% lower — led by Facebook Inc., which experienced widespread outages across all its platforms. The company’s practices are also in the spotlight after comments from a whistleblower. The technology sector fell 2.4%. Utilities and energy were the only sectors spared from the selloff.

On Monday, the Organization of the Petroleum Exporting Countries and its allies kept their current agreement to gradually raise crude production each month, including a 400,000 barrels a day increase in November. Oil futures closed higher, with the U.S. benchmark rising 2.3% to settle at $77.62 a barrel.

U.S. factory orders rose 1.2% in August, beating the 1.1% estimate of economists surveyed by The Wall Street Journal. Data To Watch 10:30am: Markit India PMI Services for September; 10:30am: Markit India PMI Composite for September. A selloff in stocks continued in Asia on Tuesday amid concern that surging prices for raw materials including crude oil will stoke inflation and hurt economic momentum.

Nifty snapped a four day losing streak on Oct 04 and ended higher. At close Nifty was 0.91% or 159 points higher at 17691. Nifty has formed a bullish morning star pattern though its placement is normally after a deep/prolonged sell-off. Advance decline ratio is also sharply positive. Nifty could continue its uptick after a weak opening and remain in the 17576-17781 band for the near term.

Daily Technical View on Nifty

Nifty : Island Reversal on Daily Chart

* Nifty opened with a gap up today and remained in the bullish te r ri to ry throughout the day. Index ended the session with the gain of 1.0% to close at 17706.25

* Bullish island reversal patterned formed on Daily chart.

* SGX Nifty is suggesting some correction. Deep correction is expected only below 17530 levels.

* If Nifty sustains above 17600 then it may continue its upward journey.

* Of 2,080 stocks traded, 1,484 advanced, 513 declined, and the rest remained unchanged

* RSI took support of 60 level on the daily chart. • Sectors which looks positive are Nifty Metal ,Nifty Media and Nifty Realty .

Nifty – Daily Timeframe chart

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