Will Nifty hold onto gains or fall below 17400- 8 things to know before stock market opens

Will Nifty hold onto gains or fall below 17400? 8 things to know before stock market opens

Indian benchmark indices are likely to open on a lower note, hinted SGX Nifty. On the Singapore Exchange, Nifty futures were in the red, down 30 points, at the 17,489 level. However, in the last session, Nifty and Sensex broke out of their rout, snapping an eight-day losing streak. Broad market indices rose more than the Nifty even as the advance decline ratio rose to 3.25:1. 

“The Indian market was oversold and needed encouraging domestic triggers to show signs of revival. The manufacturing PMI reported was better than predicted at 55.3, even though India’s Q3 FY23 GDP statistics came in slightly below expectations at 4.4%. Solid global markets, bolstered by strong Chinese manufacturing data, also ignited optimism in the domestic market,” said Vinod Nair, Head of Research, Geojit Financial Services.

US Treasury Yields

Treasury yields jumped on Wednesday after manufacturing data indicated inflation is likely to remain stubbornly high. The ISM survey indicated that manufacturing in the U.S. contracted in February as the cost of raw materials rose. The yield on the 10-year notes crossed 4% for the first time since November, but the two-year Treasury yield jumped to 4.904% before settling at 4.881%.

Asian Markets

Stocks in Asia-Pacific were lower on Thursday, following Wall Street’s cues. Japan’s Nikkei 225 traded down by 0.36%, and South Korea’s Kospi lost 0.04% in its first hour of trade. China’s Shanghai Composite and Shenzhen Component traded flat, higher by 0.05% and 0.08%, respectively. Hong Kong’s Hang Seng index traded decisively in the negative territory, losing 1.07% in trade.  

Crude Oil

Oil prices settled up slightly on Wednesday as signs of ample supply, including growing U.S. crude inventories, offset growing hopes for higher demand after a jump in manufacturing in top crude importer China. Brent crude futures settled up 86 cents, or 1%, to $84.31 a barrel. U.S. West Texas Intermediate crude (WTI) settled up 64 cents, or 0.8%, to $77.69.

FII/DII Data

Foreign institutional investors (FII) net sold shares worth Rs 425 crore, while domestic institutional investors (DII) acquired equities worth Rs 1,499 crore on 1 March, according to the provisional data available on the NSE.

F&O Ban

The National Stock Exchange has no stocks on its F&O ban list for 2 March. According to the NSE, stocks are prohibited in the F&O sector when they have exceeded 95% of the market-wide position limit (MWPL). During the F&O ban period, no new positions are permitted for F&O contracts in that stock.

Technical View

“A long bull candle was formed on the daily chart, which indicates short term upside reversal in the market. Hence, the low of Tuesday at 17,255 could now be considered as a short term bottom reversal for the market. However, the medium term down trend in Nifty remains intact and present upside bounce could be considered as a pullback rally of a bearish trend.

The larger degree negative pattern like lower tops and bottoms is still intact as per daily time frame chart. The swing low of Tuesday (17,255) could be considered as a new lower bottom formation of the sequence. Further sustainable upside from here could open short term upside bounce in the market ahead. Immediate support is at 17,250 levels and on the higher side, Nifty could encounter strong resistance at 17,600 levels,” said Nagaraj Shetti, Technical Research Analyst, HDFC Securities.

Levels to Watch

“The largest open interest for calls is at the 17,600 strike price, while the highest open interest for puts is still at the 17,400 strike price. On the other side, the support and resistance levels for the Bank Nifty are 39,900 and 41,500, respectively. The resistance has been moved up while the PE writers have aggressively added their positions at 17,300,17,400 strike price creating the base for expiry. The CE writers have drastically reduced from 17,400, 17,500 strike price and have shifted to 17,600, 17,700 strike price,” said Ameya Ranadive, CMT,CFTe, Equity Research Analyst, Choice Broking