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Market Update

Nifty : 24,773.15 +32.15 (+0.13%)

Sensex : 80,787.30 +76.54 (+0.09%)

* Equity benchmark Nifty ended marginally higher, supported by strong gains in auto majors such as Tata Motors, M&M and Bajaj Auto, while buying interest also shifted towards mid- and small-cap stocks. However, profit booking in the final hour, concerns over the 50% US tariff on Indian goods, and continued FII selling capped further upside. Market sentiment also remained cautious ahead of India and US inflation data due this week.

* The Nifty rose 32 points, or 0.1%, to close at 24,773 after hitting an intraday high of 24,885. Auto and auto ancillary shares led the rally, while IT stocks underperformed. Sectors like metals, real estate, FMCG and pharma gave up early gains due to profit booking.

* Auto stocks extended their rally after the government cut GST rates from 28% to 18%. The Nifty Auto index surged over 3% to a 52-week high of 27,189, with sentiment further boosted by auto companies’ plans to pass on GST benefits to customers from September 22. M&M, Eicher Motors, TVS Motor and Maruti jumped 2–4% to end at record highs, while auto ancillary players such as Bharat Forge, Motherson Sumi and Exide gained 3–6% on optimism around India–Europe FTA talks and a positive outlook post-GST reforms.

* Globally, Asian and European markets posted modest gains. Japan’s benchmark index climbed 1.5% as investors factored in new leadership following Prime Minister Shigeru Ishiba’s announcement to step down.

Technical Outlook:

* Nifty index opened flattish and initially tested critical support levels of 24750 levels post which it regained strength throughout the day. However the bulls gave up strength in the last hour and sharply fell to break its day’s low levels. Despite nearly touching 24900 marks, it gave up a most of its gains.

* It formed a small bodied bearish candle on daily frame with longer upper shadow indicating profit taking at minor bounces. Now it has to hold above 24750 zones for an up move towards 25000 then 25150 zones while supports can be seen at 24700 and 24600 zones.

Derivative Outlook:

* Nifty future closed positive with gains of 0.21% at 24900 levels. Positive setup seen in Ashok Leyland, Exide Industries, Eicher Motors, M&M, Tata Motors, Sona Coms, Bajaj Auto, Manappuram Finance, SAIL and HDFCAMC while weakness in Amber Enterprise, Trent, VEDL, PB Fintech, Persistent system, SBI Life, Nestle India, Max Healthcare, LTI Mindtree and HCL Technologies.

* On option front, Maximum Call OI is at 25000 then 24900 strike while Maximum Put OI is at 24800 then 24700 strike. Call writing is seen at 24900 then 24850 strike while Put writing is seen at 24800 then 24750 strike. Option data suggests a broader trading range in between 24300 to 25300 zones while an immediate range between 24500 to 25000 levels.

Global Market Update

* European Market - European stocks gained as investors awaited a confidence vote in French parliament Monday, when François Bayrou’s government is likely to fall.. Both Germany and France Index gain 0.6% and 0.2% respectively.

* Asian Market - Asian equities rose, with Japanese stocks leading gains as investors looked to new leadership after Prime Minister Shigeru Ishiba announced his intention to step down. Japan Index gained 1.5% while Hong Kong Index advance 0.8%.

* US Data - 1-Year Inflation expectation.

* Commodity - Crude oil prices jumped 2% to above $66/bbl after the OPEC+ producers announced a modest oil output hike from October and as the market expects tighter sanctions on Russia following an attack on Ukraine.

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