Domestic stock indices maintained their positive trajectory for the second consecutive day on Tuesday, driven by substantial gains in global equities. Get a comprehensive market analysis below.
Market Trends and Analysis
Range-bound Movement Expected Amid Data-packed Week and Monsoon Concerns
As the market moved within a defined range, analysts anticipated this trend to persist due to a week filled with crucial data releases and the ongoing monsoon concerns. Investor worries were further compounded by consistent selling by Foreign Institutional Investors (FIIs) and unfavorable monsoon conditions throughout August. These factors collectively restrained potential market upside.
Pre-market Indications Point to a Positive Start
GIFT Nifty Signals Positive Start for Dalal Street
Pre-market indicators illuminated a promising opening for Dalal Street on Wednesday, as the GIFT Nifty on the NSE IX traded higher, indicating an upbeat start.
Technical Outlook
Sturdy Support and Resistance Levels Shape Market Behavior
From a technical perspective, the market displayed robust support at 19245, acting as a formidable defense against further declines. An upper resistance level at 19425 was identified; surpassing this level could potentially trigger a more substantial rally. The prevailing expectation was for range-bound trading until a decisive breakout occurred on either side.
Fear Gauge Shows Decrease in Market Apprehension
India VIX Reflects Reduced Fear in Markets
The India VIX, measuring market fear, receded by 1.39% to settle at 12.22 levels, indicating a diminishing sense of apprehension among market participants.
Global Market Insights
Wall Street and Asian Markets React Positively
Wall Street witnessed a notable upswing, primarily attributed to the robust performance of megacap growth stocks such as Tesla and Nvidia. This surge was underpinned by expectations that a reduction in monthly job openings would prompt the U.S. Federal Reserve to pause its interest rate hikes. Notably, the S&P 500, Nasdaq, and Dow indices recorded gains of 1.45%, 1.74%, and 0.85% respectively.
Asian markets echoed this positivity, as major Chinese banks reportedly geared up for interest rate cuts, while speculations circulated that the Federal Reserve was approaching the conclusion of its tightening policy. Various Asian indices also experienced gains, including Japan’s Topix index (up by 0.5%), Australia’s S&P/ASX 200 Index (increased by 0.6%), and Hong Kong’s Hang Seng futures (up by 1.1%).
Oil Prices and Market Impact
Oil Prices Maintain Upward Trajectory Amid Data and Concerns
Oil prices sustained their upward trajectory, buoyed by indications of a significant reduction in U.S. crude inventories and apprehensions surrounding a Gulf of Mexico hurricane. Brent crude futures for October climbed by 0.2%, reaching $85.66 a barrel, while the more active November contract stood at $85.08 a barrel, reflecting a gain of 0.2%.
Stocks in Focus: F&O Ban and Institutional Activities
Several Stocks Under F&O Ban, Institutional Activity Insights
Certain stocks found themselves subject to the F&O ban due to exceeding 95% of the market-wide position limit. The list included Escorts, GMR Infra, RBL Bank, Manappuram Finance, Sun TV, Hindustan Copper, and Indiabulls Housing Finance.
Foreign portfolio investors recorded marginal net purchases of Rs 61 crore on Tuesday, whereas Domestic Institutional Investors (DIIs) accumulated shares worth Rs 305 crore.
Rupee Movement and Influential Factors
Indian Rupee Faces Pressure Amid Dollar Buying
The Indian rupee concluded the session at Rs 82.70 against the dollar. The pressure on the rupee stemmed from dollar buying by oil companies and major importers, offsetting the currency’s initial gains.
Disclaimer: The information provided here is for educational purposes only and should not be considered financial advice. Always conduct thorough research and consider consulting a financial professional before engaging in algorithmic trading.