Domestic equity benchmarks concluded Friday’s volatile session in the negative territory with BSE Sensex falling nearly 400 points to 62,181.67 and NSE Nifty settling below 18500. The broader indices ended red with the Nifty Midcap 50 sinking 58 points. Most of the sectoral indices also turned negative and the only gainers were Nifty bank, Nifty FMCG, Nifty Pharma and Nifty Healthcare.
Rupak De, Senior Technical Analyst at LKP Securities
“Nifty remained volatile before closing lower as Nifty ended more than 100 points lower. On the daily chart, the index slipped below the recent consolidation, suggesting a rise in pessimism. Besides, the bulls failed to protect the 18,500. Going forward, the trend may remain negative with support placed at 18,350/18,200. On the higher end, 18,670 may act as crucial resistance.”
Vinod Nair, Head of Research at Geojit Financial
“Today’s downfall in the domestic market was sparked by IT stocks extending their losses after warning of a potential slowdown in business on global recession fears. This was further aggravated by banks losing their grip as PSBs suffered heavy sell-offs. However, global bourses were largely positive, although the Fed is expected to raise interest rates by 50 basis points next week.”
Devarsh Vakil, Deputy Head of Retail Research, HDFC Securities
Nifty failed to surpass the crucial resistance of 18730 and plunged more than 250 points from the early morning high of 18664. From the day’s low, Nifty recovered more than 100 points towards the end. At close, Nifty was down 0.6% or 113 points at 18496. IT stocks tumbled post caution sounded by HCL Tech management. They have indicated that growth for FY23 will come at the lower end of the range than what was indicated post its 2QFY23 results due to higher-than-expected furloughs. Among sectors, Technology, PSU Banks and Reality indices fell the most while FMCG and Pharma were the outperformers. Nifty small cap underperformed the Nifty with advance decline ratio on BSE ended at 0.5:1. Nifty registered day’s low at 18410, which happens to be the upward sloping trend line support on the daily chart. A break below 18410 could result in more selling in the index and therefore it should be kept as a stop loss in longs. On the higher side 18600-18650 level to act as an immediate resistance. Bank Nifty continued its out performance and managed closed at yet another all-time high level.
Kunal Shah, Senior Technical Analyst at LKP Securities
“The Bank Nifty index witnessed some selling pressure at higher levels where fresh short positions were built up. The index is still trading in a broad range between 43,000-44,000 where a significant amount of put and call writing has been witnessed respectively. The index must decisively breach the range for a trending move on either side.”
Ajit Mishra, VP – Technical Research, Religare Broking Ltd
Markets drifted lower and lost over half a percent amid mixed cues. After the flat start, the Nifty index gradually inched lower for most of the session however marginal rebound in the last hour trimmed some losses. It finally settled at 18,496.60 levels; down by 0.61%. The pressure was board-based but a sharp decline in the IT majors was largely weighing on the sentiment. Indications are in the favour of prevailing consolidation to continue and sustainability above 18300 in Nifty is critical to maintain the positive tone. Among sectors, banking and FMCG look promising while others may contribute selectively. Traders should plan their positions accordingly.