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Market Update

Nifty : 24,008.00 -265.80 (-1.10%)

Sensex : 79,454.47 -880.34 (-1.10%)

* The equity benchmark Sensex plummeted nearly 900 points, and the Nifty fell over 1%, as tensions between India and Pakistan escalated, raising concerns of a broader conflict. This geopolitical uncertainty led to a sharp decline in the markets, with the Sensex dropping 880 points (1.10%) to close below the 80,000 mark at 79,454, while the Nifty fell 265 points (1.1%), settling above the 24,000 level at 24,008.

* The India VIX surged 3%, reaching a one-month high of 21.63.

* Additionally, traders adopted a cautious approach, booking profits ahead of a long holiday, given the lack of clarity regarding the duration of the conflict.

* Realty stocks were the hardest hit, falling by 2.4%, and large-cap private banks saw sharp declines, pulling the Bank Nifty down by over 1%.

* Hotel and airline stocks also experienced some profit booking. On the other hand, Nifty defense stocks saw a strong rally, with the Nifty Defense Index rising by 3%, driven by gains in BDL, Paras Defense, Premier Explosives (up 19%), Data Pattern, and Mazagon Dock.

* The PSU Bank Index rose by 1.6% following strong Q4 results from Canara Bank, which saw its shares gain 2.4%, closing at Rs97.60. Globally, US index futures, Asian markets, and European markets saw gains ahead of expected US-China trade talks this weekend, fueled by optimism surrounding a potential tariff reduction after an initial agreement with the UK.

Technical Outlook:

* Nifty opened with a big gap down of over 300 points around the 23950 level, mainly due to rising geopolitical tensions. In the first half, the index was quite volatile, moving up and down sharply. Later in the day, Nifty started to slide slowly, as selling pressure continued at higher levels. Even small up moves were getting sold into, showing weak buying interest.

* The index broke below its recent six day range and closed with losses of nearly 270 points. On both the weekly and daily charts, Nifty has formed a bearish candle, erasing all the gains made in the previous week. Now till it holds below 24200 zones weakness could be seen towards 23800 then 23600 zones while hurdles can be seen at 24300 then 24444 zones.

Derivative Outlook:

* Nifty future closed negative with losses of 0.74% at 24092 levels. Positive setup seen in Union Bank Of India, Bharat Forge, Titan, IIFL Finance, LT, Tata Motors, BEL, ABB, UPL, Solar Industries, Kalyan Jewellers, Canara Bank and HAL while weakness in MCX, Apollo Tyres, M&M Finance, DLF, Indian Hotels, Lodha, Torrent Power, Dixon, NHPC, Power Grid, CAMS and HFCL.

* On option front, Maximum Call OI is at 25000 then 24500 strike while Maximum Put OI is at 24000 then 23000 strike. Call writing is seen at 24000 then 24100 strike while Put writing is seen at 24000 then 23900 strike. Option data suggests a broader trading range in between 23500 to 24500 zones while an immediate range between 23800 to 24200 levels.

Global Market Updat

* European Market - Germany’s DAX Index became the first European gauge to surpass its March record high, recouping all declines sparked by US President Donald Trump’s trade war. UK, Germany and France Index gain 0.5% each.

* Asian Market - Asian stocks gained ahead of the US-China trade talks expected this weekend, after an initial agreement with the UK stirred up optimism over more tariff relief.

* US Data - Federal Budget Statement.

* Commodity - Brent crude prices surged 2% to above $63/bbl, driven by increased optimism among investors following the announcement of a US-UK trade deal, and were still up during early hours on Friday.

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