Indian benchmark indices BSE Sensex, NSE Nifty 50 are likely to open in red, tracking weak global. Early trends in SGX Nifty hinted at a gap-down opening for the broader domestic frontline index with a loss of 121 points. Markets will react to the Fed’s interest rate hike decision. An aggressive commentary is expected to lead to higher volatility and pressure on the market, according to analysts. “If Nifty trades below 17700, it could trigger short-term correction. Below the same, the index could slip till 17550-17500. The current market texture is non directional, hence level-based trading would be the ideal strategy for short-term traders,” said Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities.
5 things to know before share market opening bell
Global market watch: Wall Street’s main indexes slumped on Wednesday as investors digested another supersized Federal Reserve hike and its commitment to keep up increases into 2023 to fight inflation. All three benchmarks finished more than 1.7% down, with the Dow posting its lowest close since June 17, with the Nasdaq and S&P 500 respectively, at their lowest point since July 1, and June 30. Asia markets traded lower on Thursday. Japan’s Nikkei 225 slipped 1% in early trade, and the Topix index fell 0.78%. South Korea’s Kospi dropped 1.12%. MSCI’s broadest index of Asia-Pacific shares outside Japan fell 0.46%.
Nifty technical view: A small negative candle was formed on the daily chart with minor upper and lower shadow. Technically, this pattern indicates a consolidation movement in the market. After a sharp weakness on 15th and 16th September, the market showing small range weakness could signal broader range movement. The short-term trend of Nifty continues to be choppy. The market is stuck within a broader high low range of 18100-17500 levels and the movement within the said range is expected for the next few sessions. Any decisive move beyond this range could bring acceleration in the momentum on either side, according to Nagaraj Shetti, Technical Research Analyst, HDFC Securities.
Levels to watch for: “Nifty has been in a corrective phase since the last few trading sessions. Monthly support is only seen at 17000. Expect consolidation to correction in the near term as the broader market sentiment has also turned negative. FII and PRO positions also suggest reduction in net shorts suggesting limited downside in near term. For Nifty, maximum OI buildup seen at 17000 Put and 18000 Call Option. For Bank-Nifty, maximum OI buildup is seen at 40500/41000 put and 41500/42000 call options. For the expiry day, expect nifty to trade with resistance of 17950 – any move above the same can invite short covering,” said Sahaj Agrawal, Head of Research- Derivatives at Kotak Securities.
Stocks under F&O ban on NSE: Ambuja Cements, Can Fin Homes, Delta Corp, Escorts, PVR, and RBL Bank are the six stocks under the NSE F&O ban list for September 22. Securities thus banned under the F&O segment include companies where derivative contracts have crossed 95% of the market-wide position limit.
FII and DII data: Foreign institutional investors (FIIs) offloaded net shares worth Rs 461.04 crore, while domestic institutional investors (DIIs) net bought equities worth Rs 538.53 crore on Wednesday (21 September), according to the provisional data available on the NSE.