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Sensex, Nifty tank amid inflation worries, weak earnings; Can D-St bounce back or will bears tighten grip?

S&P BSE Sensex tanked 1,172 points or 2.01% to settle at 57,166 while the NSE Nifty 50 index dived 302 points or 1.73% to end at 17,173.

India VIX ended 8% higher, breaching 19 levels. (Image: REUTERS)

Domestic stock markets started the week with losses, ending Monday’s trade in the firm grip of bears amid weak global cues, high inflation worries and underperformance of bank stocks. S&P BSE Sensex tanked 1,172 points or 2.01% to settle at 57,166 while the NSE Nifty 50 index dived 302 points or 1.73% to end at 17,173. NTPC shares price rose 6.5% as the top Sensex gainer, accompanied by Tata Steel, Maruti Suzuki India, and Titan. Infosys was down 7%, HDFC, HDFC Bank, Tech Mahindra, and TCS followed. Bears forced Bank Nifty to close 1.96% lower along with broader markets. India VIX ended 8% higher, breaching 19 levels. 

Nagaraj Shetti, Technical Research Analyst, HDFC Securities –

“The short term trend of Nifty is negative. The overall chart pattern indicates a possibility of an upside bounce in the market from here or from near the 17,000 mark. The confirmation of reversal pattern and the strength of upside bounce is likely to open a relief rally for the market.”

Sumeet Bagadia, Executive Director, Choice Broking –

“On the derivatives front, the highest call options OI is at 17500/17400 strike price followed by 17200 while on the put side, the highest put OI is at 17000 strike price followed by 17200 levels. Technically, the index has formed a Doji candlestick on the daily chart but closed below the Middle Bollinger Band formation & 100-Days Exponential Moving Averages suggest bearish moves for the coming day. At present, the index is having support at 17000 levels while resistance is placed at 17370 levels. On the other hand, Bank nifty has support at 36200 levels while resistance at 37400 levels.”

 Mohit Nigam, Head – PMS, Hem Securities –

“Nifty 50 closes its day below good resistance zone of 17,300 and if the index holds below the 17,300 mark for coming trading sessions then we may see more downward move towards 16,800-16,500 mark which is another support zone on the downside. The market breadth was skewed in the favour of bears. Crucial support for Nifty 50 is 17,000 while Nifty may face some resistance at 17,500.”

Vinod Nair, Head of Research at Geojit Financial Services

“Unfavourable start to earnings season in heavyweight stocks of IT and banking sector led to heavy sell-off. Lower-than-expected results prompted the market to worry about the headwinds faced by the IT sector like attrition, wage inflation, lower utilization, and cut in IT spending by industries due to geopolitical and macro issue. The degree of downfall is high because the sector was trading at high valuation and risk of a downgrade in outlook has increased.”

 S Ranganathan, Head of Research at LKP securities

“Indices opened gap down on the back of weak global cues as the federal reserve tightens policies to tame inflation. Benchmark Indices never really recovered during the day from the twin blow of the IT Index & the Bank Nifty with rising oil prices and inflationary pressures adding to the woes. The broader markets did see buying interest in select pockets like Defence, Paper & Fertilisers on the back of continued positive Tailwinds.”

Ajit Mishra, VP – Research, Religare Broking –

“Markets started the week on a muted note, in continuation of the prevailing consolidation phase and ended the session with a sharp loss of nearly two per cent. We believe global cues, as well as the outcome of Q4 earnings, will continue to add volatility in the coming sessions. Hence, we would remain cautious on the markets and suggest traders to keep their position hedged.”

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