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Indian markets could open mildly higher, in line with largely positive Asian markets today and positive Dow Jones index in US markets on Monday -  HDFC Securities

The Dow Jones Industrial Average and the S&P 500 booked their first positive close in six sessions Monday, with the blue-chip index scoring its best daily gain in about five weeks. The Nasdaq Composite ended 1% lower, extending its losing streak to a fourth session in a row with selling in healthcare, growth and value stocks weighing on equities. House Democrats have proposed a capital gains tax rate hike that was lower than many had feared. The party’s new tax policy proposal includes a hike to 25% from 20% on capital gains, more benign than the feared raise to 39.6%. The Democrats also proposed a corporate tax hike to 26.5% from 21%, though President Biden had initially desired a raise to 28%.

The U.S. federal budget deficit narrowed to $2.71 trillion in the first 11 months of the fiscal year, the Treasury Department said Monday. This is down $297 million or 10% from the $3 trillion deficit over the same period last year. An investor survey conducted by Deutsche Bank found more than two-thirds of respondents expecting at least a 5% decline in stocks by the end of the year. The same survey found the biggest risks to the market are new variants that bypass vaccines, and higher than expected inflation or bond yields.

China fired a fresh regulatory shot at its tech giants, telling them to end a long-standing practice of blocking each other's links on their websites. The Financial Times also reported that China is aiming to break up the payments app Alipay. India’s Consumer Price Index-based Inflation (CPI) for August 2021 came in at 5.30 percent, compared with 5.59 percent in July, as food prices cooled further, especially in the case of vegetable inflation. Consumer Food Price Inflation (CFPI) for August stood at 3.11 percent compared to 3.96 percent in July.

Asian stocks were steady Tuesday after the U.S. snapped a five-day drop ahead of inflation data that could impact expectations of the likely timeline for a reduction in Federal Reserve stimulus. In Hong Kong, China Evergrande Group’s stock plunged more than 6% after the embattled property developer on Tuesday flagged expectations for a “significant continuing decline in contract sales in September,” with dampened confidence after negative media reports surrounding the firm.

Nifty closed mildly down in a narrow band of closings over the past four days on the first day of the trading week on Sept 13. At close, Nifty was down 14 points or 0.08% at 17355. Nifty continues to close in a narrow band of 17353-17378 over the past 5 sessions. This reflects lack of enthusiasm on the part of sellers to sell aggressively while buyers keep nibbling at individual stocks. Advance decline ratio continues to be positive. 17254-17437 is the band for the near term for the Nifty.

Daily Technical View on Nifty

Nifty : Consolidation

* Nifty consolidated in the narrow range for the fifth consecutive session.

* Nifty closed with minor loss of 0.8%, to settle at 17355

* From the day’s low Nifty recovered more than 100 points, which is a good sign

* Nifty has been outperforming allmost all the asian markets

* On hurly charts, “flag” pattern is getting developed and any time soon it is likely to be taken out

* Primary trend of the Nifty has been bullish with higher tops and higher bottoms

* Nifty has been managing to hold above its 5 days EMA support

* Nifty is placed above 5, 10, 20, 50, 100 and 200 DMA, which indicates strength in the current bull run

* Recent high of 17430 is expected to act as a resistance, above which bullish momentum would pick up the pace

* Yesterday’s low of 17269 would act as a support

* Traders should trade with bullish approach in today’s session.

* Sectors like Chemical, IT, and Auto are likely to do well in today’s session

Nifty – Daily Timeframe chart

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