SGX Nifty falls, Sensex, Nifty eye cautious start; five things to know before market opens

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October 06, 2021 8:04 AM

Domestic equity market benchmarks BSE Sensex and Nifty 50 were staring at a cautious start on Wednesday, a day before weekly F&O expiry

Nifty, SensexAnalysts say On daily charts, based on post reversal formation the Nifty has formed uptrend continuation formation

Domestic equity market benchmarks BSE Sensex and Nifty 50 were staring at a cautious start on Wednesday, a day before weekly F&O expiry. In the previous session, headline indices ended higher for the second straight day. Sensex settled at 59,744 while Nifty 50 closed at 17,822. Bank Nifty gained 0.43% to close at 37,741. Asian stock markets were seen trading mixed in early trade. “Domestic cues remain positive as economic activities gain further momentum and India’s current account surplus in 1QFY22 and high-frequency indicators suggest sharp macro-economic recovery,” Siddhartha Khemka, Head – Retail Research, Motilal Oswal Financial Services, said.

SGX Nifty in red: Nifty futures were trading 25 points or 0.14 per cent down at 17,794 on Singaporean Exchange, suggesting a cautious start for benchmark indices.

Global watch: Following an overnight bounce on Wall Street, Asian stock markets were seen struggling for direction. Japan’s Nikkei 225 fell 0.18% while the Topix index advanced 0.4%. South Korea’s Kospi slipped 0.46%. US stocks surged higher on Tuesday. The Dow Jones Industrial Average rose 0.92%, the S&P 500 gained 1.05% and the Nasdaq Composite added 1.25%.

What do charts say for Nifty50: Nifty held on to the 17640 support level, and in the late afternoon it finally cleared the intraday resistance of 17725. “On daily charts, based on post reversal formation the index has formed uptrend continuation formation while on intraday charts it has formed promising higher high and higher low series formation which clearly support further uptrend. We are of the view that 17750 would be the key support level for the trend following traders. If the index rises above the same the uptrend texture is likely to continue up to 17880-17900 levels. On the flip side, below 17750, it may trigger quick intraday correction up to 17710,” Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities, said.

FII and DII activity: On Tuesday, foreign institutional investors (FIIs) offloaded shares worth Rs 1,915.08 crore, while domestic institutional investors (DIIs) lapped up shares worth Rs 1,868.23 crore on a net basis in the Indian stock market.

India’s rating outlook stable: Appreciating that banks and NBFCs now pose a lesser downside risk to the real economy thanks to the steps taken by the government and the banking regulator to repair their impaired balance sheets, Moody’s Investors Service on Tuesday affirmed India’s sovereign rating at Baa3, the lowest investment grade, while upgrading the country’s outlook to ‘stable’ from ‘negative’.

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