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Market Update

Nifty : 24,888.20 -253.20 (-1.01%)

Sensex : 81,691.98 -823.16 (-1.00%)

* The equity benchmark Sensex plunged over 800 points, with the Nifty closing below the 24,800 mark, driven by concerns over global uncertainties. These include rising geopolitical tensions in the Middle East, a two-month high surge in oil prices above $69 per barrel, upcoming domestic inflation data to be release today, and ongoing uncertainty regarding U.S. trade policies.

* Global market sentiment weakened after U.S. President Donald Trump hinted at the possibility of new unilateral tariff rates being announced within weeks, ahead of the July 9 deadline to reinstate higher duties on several trading partners. Trump mentioned that affected countries would be notified within one to two weeks, essentially issuing a trade ultimatum. Meanwhile, tensions escalated in the Gulf region as Iran warned it might target U.S. military bases if nuclear negotiations fail.

* Consequently, U.S. Index futures and major Asian and European indices dropped by up to 1%. The Sensex fell by 823 points, or 1%, closing at 81,691, while the Nifty declined 253 points, or 1%, to settle near 24,900. Sector-wise, Nifty Realty, Oil & Gas, Defense, Auto, Mid-cap, and Small-cap indices saw declines ranging from 1% to 2%, primarily due to profit booking. The Nifty 500 stocks advance-decline ratio stood at 1:4, reflecting widespread selling pressure across the market.

Technical Outlook:

* Nifty Index opened on a flattish note, but bears took charge right from the opening tick, as the index witnessed selling pressure from higher levels. It inched lower throughout the session, with every small bounce being sold into, indicating persistent weakness. Due to this pressure, the index slipped below the psychological 25,000 mark, breaching it after the recent breakout. Nifty corrected more than 350 points from its intraday high and took support near its 20-day EMA, witnessing a minor recovery in the last hour.

* It formed a large bearish candle on the daily chart, wiping out gains of the last three sessions. The index also negated its recent sequence of higher highs and ended the day with losses of around 250 points. Now till it holds below 25000 zones, profit booking could be seen towards 24750 then 24600 zones while hurdles can be seen at 25000 then 25100 zones.

Derivative Outlook:

* Nifty future closed negative with losses of 1.20% at 24909 levels. Positive setup seen in DR Reddy, Techm, SBI Card, Muthoot Finance, AU Bank, Max Health, Torrent pharma, Apollo hospitals, RBL Bank, Wipro and LTIM while weakness in ABFRL, Shriram finance, IEX, Piramal pharma, Petronet, Dixon, Titan, Powergrid, Cipla and LT.

* On option front, Maximum Call OI is at 25200 then 25500 strike while Maximum Put OI is at 24000 then 24500 strike. Call writing is seen at 25100 then 25000 strike while Put writing is seen at 24900 then 24000 strike. Option data suggests a broader trading range in between 24400 to 25400 zones while an immediate range between 24600 to 25100 levels.

Global Market Update

* European Market - European stocks fell as fresh trade war concerns weighed on investor sentiment after President Donald Trump said he would set unilateral tariff rates within two weeks. Germany and France Index decline 1% each.

* Asian Market - Asian markets declined after US President Donald Trump signaled plans to set unilateral tariff rates within weeks, ahead of a July 9 deadline to re-impose higher duties on multiple economies. Japan, China and Hong Kong Index slipped 0.5% each. Trump announced that the U.S. would inform trading partners about the new unilateral tariff terms within a span of one to two weeks, implying that countries would receive an ultimatum.

* US Data - Producer Price Index (PPI) and Initial Jobless Claims.

* Commodity - Brent Crude rose 4% to above $69/bbl as traders tracked tensions in the Middle East and the latest moves in US trade policy. Iran threatened to strike US bases in the region if talks over its nuclear program fell through.

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