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Market Update

Nifty : 25,815.55 -3.00 (-0.01%)

Sensex : 84,481.81 -77.84 (-0.09%)

* Equity benchmark Nifty ended on a flat note in a highly volatile session as investors stayed cautious ahead of the US inflation data due later today. Market sentiment was further dampened by uncertainty over the progress of the India–US trade deal and weakness across global markets. Adding to the cautious tone were key central bank events, with the Bank of England set to announce its rate decision today and the Bank of Japan scheduled to unveil its policy decision tomorrow. Broader markets continued to underperform, as traders rotated towards fundamentally strong large-cap stocks. The Nifty closed marginally lower by 3 points, or 0.01%, at 25,815, after moving between an intraday high of 25,902 and a low of 25,726.

* Sectorally, select IT, metal and AMC stocks led the gains, while private banks saw fresh buying interest, driven by Axis Bank and ICICI Bank. On the downside, defence, pharma and capital goods stocks witnessed profit booking. The Nifty IT index outperformed, rising over 1% ahead of Accenture’s earnings announcement later today. TCS gained 2% to close at Rs.3,280 after reports that it secured a $1 billion contract from Telefónica UK. Asset management company stocks such as Nippon Life, HDFC AMC, UTI AMC and Nuvama rallied 2–6% after SEBI revised expense ratios and brokerage caps more favourably than initially proposed. The metal index also ended higher, supported by rising base metal prices on the LME and record-high silver prices, with Vedanta, Hindustan Copper and Hindustan Zinc advancing 2–5%. Globally, the Nasdaq Composite fell nearly 2% overnight, while Asian markets declined, led by technology stocks amid concerns over the artificial intelligence sector. In contrast, the UK market gained on hopes of a rate cut, supported by easing inflation ahead of the Bank of England’s policy announcement.

Technical Outlook:

* Nifty index opened negative but attempted recovery to cross 25900 zones but failed to hold at higher zones. It gave up strength in the second half and fell to 25700 marks. Index has been witnessing a tug of war between the bulls and bears from the last few sessions. It formed a small bodied bullish candle on the daily frame but with longer upper shadow indicating pressure is intact at higher zones and is continuously making lower highs – lower lows from the last four sessions. Now till it holds below 25900 zones, weakness could be seen towards 25700 then 25600 zones while hurdles have shifted lower to 25900 then 26000 zones.

* S&P BSE Sensex index opened on a flattish note near 84450 zone and witnessed a strong recovery towards 84780 zones. Bulls displayed dominance till midday; however, bears stepped in thereafter and dragged the index lower once again. The absence of follow up buying at higher levels restricted bulls from carrying the index further up. On the daily chart it formed a small bodied candle with wicks on both sides indicating a clear tug of war between bulls and bears. The index continues to hover near its 50 DEMA, highlighting a phase of indecision near its crucial support. Now till it holds below 84800 zones weakness could be seen towards 84200 then 83900 zones while hurdles have shifted lower to 84800 then 85100 zones.

Derivative Outlook:

* Nifty future closed negative with losses of 0.06% at 25882 levels. Positive setup seen in Hindustan Zinc, Ashok Leyland, TCS, Voltas, Vedanta, Tech Mahindra, MCX, Hindalco, Federal Bank and Laurus Labs while weakness in SAIL, NCC, BHEL, Bandhan Bank, Sonacoms, Piramal Pharma, Kaynes, JSW Energy, RVNL and Asian Paints.

* On option front, Maximum Call OI is at 26000 then 25900 strike while Maximum Put OI is at 25800 then 25700 strike. Call writing is seen at 25800 then 25900 strike while Put writing is seen at 25700 then 25800 strike. Option data suggests a broader trading range in between 25300 to 26200 zones while an immediate range between 25600 to 26000 levels.

Global Market Update

* European Market - European stocks were muted as investors looked ahead to interest rate decisions from the European Central Bank and Bank of England. UK, Germany and France Index are flat to positive.

* Asian Market - Asian equities edged lower, with South Korea leading a broad selloff on concerns over the artificial intelligence sector. Both Japan and South Korea Index declined 1% and 1.5% respectively.

* US Data - CPI and Initial Jobless claims.

* Commodity - Brent Crude gained 1% to above $60/bbl after President Trump ordered a total blockade of all sanctioned tankers entering and leaving Venezuela, raising risks of prolonged supply disruptions in the region.

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