Trade setup for 30 December: Markets likely to trade sideways; key things to know before opening bell

SGX Nifty signalled a positive start for Indian equities as Nifty futures were trading 26.50 points or 0.15 per cent up at 17,240 on Singaporean Exchange in early trade.

Stock Market
Indian equity markets are likely to open in green amid positive global cues

Bears made a comeback on Dalal Street as Indian equity benchmarks snapped a two-day winning streak to end Wednesday’s choppy session mildly lower, ahead of the expiry of December futures and options contracts. The BSE Sensex ended 91 points down at 57,806.5, while the Nifty50 fell 20 points to 17,213. Gains in pharma and auto stocks was offset by financial and IT counters. However, the broader markets outperformed the benchmark indices with Nifty Midcap 100 and Smallcap 100 indices gaining 0.13 percent and 0.59 percent respectively. Indian equity markets are likely to open in green amid positive global cues. SGX Nifty signalled a positive start for Indian equities as Nifty futures were trading 26.50 points or 0.15 per cent up at 17,240 on Singaporean Exchange in early trade.

Key things to know before market opening bell

Global markets

US Markets closed on a positive note on Wednesday with the S&P 500 gaining 0.14% to end at 4,793.06 — its 70th record close of 2021. The Dow Jones Industrial Average also closed at a record, rising 90.42 points to 36,488.63 while the Nasdaq Composite lagged, slipping 0.1% to about 15,766.22. Shares in the Asia-Pacific region were mostly higher today following gains overnight on Wall Street which led to record close for both the S&P 500 and Dow Jones Industrial Average. Hong Kong’s Hang Seng index rose 0.48%. Mainland Chinese stocks were also higher, with the Shanghai composite up 0.5% and the Shenzhen component advancing 0.852%. Japan’s Nikkei 225 fell 0.12% while the Topix index hovered above the flatline. South Korea’s Kospi climbed 0.06%. In Australia, the S&P/ASX 200 fell 0.13% today while MSCI’s broadest index of Asia-Pacific shares outside Japan traded 0.28% higher.

Technical view

After showing a sustainable upmove in the last couple of sessions, Nifty slipped into minor weakness amidst volatility on Wednesday and closed the day lower by 19 points. After opening on a negative note, the market moved up in the early part of the session. It later shifted into an intraday volatility in the mid part and lost grounds towards the end to close near the lows. A small negative candle was formed on the daily chart with upper shadow. Technically, this pattern indicates a lackluster type movement at the crucial overhead resistance. This could hint at a possibility of downward correction in the market from the highs, said Nagaraj Shetti, Technical Research Analyst, HDFC Securities on today’s market performance.

The market is currently placed at the important trend line resistance around 17300 levels (down sloping trend line connecting lower highs). The market showing weak upside strength to surpass the hurdle on Wednesday could indicate chances of further consolidation or minor weakness in the short term. The negative chart pattern of lower tops and bottoms is intact on the daily chart and current upside could be in line with lower high formation (lower top needs to be confirmed). Recently, Nifty showed strength during minor dips and bounced back sharply from the lows. The market seems to have placed at the crucial overhead resistance and lacking its strength to surpass the hurdle. There is a higher possibility of further consolidation or downward correction in the next 1-2 sessions before showing further upside bounce again from the lows, he added.

Nifty support, resistance levels

After a flat opening on Tuesday, Nifty traded in range and managed to close with a moderate loss of 19.65 points at the 17213.60 level. The index found resistance on the downward sloping trend line adjoining previous swing highs on the daily chart. 50 days EMA has also been acting as a hurdle for the Nifty at 17340. Nifty has got strong support at the 17050 odd levels, derived from the upward sloping trend line, adjoining previous swing lows on the daily chart, said Devarsh Vakil, Deputy Head of Retail Research, HDFC Securities

Bank Nifty

The Nifty Bank closed yesterday’s trading session at 35045.40 level with a loss of 138.40 points. The index has support at 34500 levels while the resistance is placed at 35500 levels, said Palak Kothari, Research Associate, Choice Broking.

Call option data

The maximum call open interest is placed at the strike price of 17,500, with 1.8 lakh contracts, followed by 17,300, with 1.6 lakh contracts, according to exchange data. This is followed by 18000 strike, which has accumulated 63.34 lakh contracts. Call writing was seen at 17300 strike, which added 30.12 lakh contracts, followed by 17500 strike with 19.83 lakh contracts, and 17400 strike with 17.72 lakh contracts. Significant support placed at 17,000, and immediate resistance at 17,300 mark followed by a major hurdle at 17,500.

Put Option data

The maximum put open interest is accumulated at strike price of 17,000, with nearly two lakh contracts, followed by strike price of 17,200, 17,100 and 16,700, with 1.3 lakh contracts each. Put writing was seen at 16700 strike, which added 32.78 lakh contracts, followed by 17100 strike with 10.14 lakh contracts and 17200 strike with 8.36 lakh contracts.

Bulk deals

Sigachi Industries: Foreign investor 3 Sigma Global Fund sold nearly half of its stake in Sigachi Industries, offloading 2.46 lakh equity shares at a price of Rs 403.4 per share on the NSE, and offloading 3 lakh equity shares at a price of Rs 402.01 per share on the BSE, the bulk deals data showed.

HP Adhesives: Foreign investor Nexus Global Opportunities Fund sold 3,04,923 equity shares in the company at Rs 369.2 per share on the BSE to exit HP Adhesives, the data showed. BW Traders bought 1,09,394 HP Adhesives shares at Rs 364.47 per share. Meanwhile, Rajasthan Global Securities sold 2.23 lakh shares at Rs 364.6 per share on the NSE, according to bulk deals data.

Analysts/Investors Meeting

GMM Pfaudler: Officials to interact with analysts and investors

Somany Home Innovation: Officials to interact with Edelweiss Financial Services and Nirmal Bang

Balrampur Chini Mills: Company officials to meet HDFC MF

PSP Projects: Officials will meet IDFC AMC

GRP: Officials will meet investors and analysts

Stocks under F&O ban on NSE

Indiabulls Housing Finance, Vodafone Idea, and RBL Bank – are the three stocks under the F&O ban for Thursday (December 30). Securities in the ban period under the F&O segment include companies in which the security has crossed 95 percent of the market-wide position limit.

FII and DII activity

Foreign institutional investors (FIIs) net purchased Indian equities worth Rs 975.23 crore on Wednesday (29 December) while domestic institutional investors purchasesd shares worth Rs 1,006.93 crore in the Indian equity market on December 29, according to the provisional data available on the NSE.

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