Markets Ahead- Sensex, Nifty snap 3-day gaining streak; investors cautious as Fed hawkish, markets overvalued

Markets Ahead: Sensex, Nifty snap 3-day gaining streak; investors cautious as Fed hawkish, markets overvalued

Domestic indices NSE Nifty and BSE Sensex regained from day’s lows, but still closed in the red. Nifty closed below the 18,000 mark after regaining 100 points from the day’s low. Sensex added over 300 points from its intraday low to settle at 60,353. Bank Nifty lost 350 points in today’s session. The broader markets closed mixed, as Nifty Next 50 settled 0.69% higher while Nifty 50 closed 0.28% down on the weekly F&O expiry. Sectorally, Nifty Auto and Nifty FMCG gained 1.16% and 1.55% but Nifty Financial Services shed 1.18% and Nifty IT ended 0.5% lower. Bajaj Finance and Bajaj Finserv were Nifty 50’s top laggards on Thursday.Markets Decoded: Hawkish Fed stance affecting investors

“Globally, investors are digesting the FOMC minutes with stock markets trading lower revealing that the Fed officials’ are determined to tame inflation by maintaining its aggressive stance. Financials led the losses in the domestic market, following dismal business numbers from NBFC leader. Oil prices recovered after falling sharply on fears of a worldwide recession, as investors remain optimistic about long-term demand.” – Vinod Nair, Head of Research, Geojit Financial Services

Nifty Technical View: Resistance seen around 18,100

“After opening with a positive note, the market failed to sustain the opening gains and slipped into weakness for the better part of the session. Sustainable upside recovery has emerged from the days low of 17,892 in the mid part and Nifty closed the day off the lows. A reasonable negative candle was formed on the daily chart with a long lower shadow. Technically this pattern indicates downside continuation pattern amidst volatility. The upside recovery of Thursday signals that buying is expected to emerge from near the lower support of around 17,750-17,800 levels. Negative chart patterns like lower tops and bottoms continued on the daily chart and the Nifty is expected to revisit the recent swing lows of 17,775 levels in the short term. Any upside bounce from here could encounter resistance around 18,100 levels.” – Nagaraj Shetti, Technical Research Analyst, HDFC Securities

“Volumes on the NSE are rising gradually as people return to work after holidays. Broad market improved over the previous session with the advance-decline ratio rising to 0.92:1.Capital Goods, Tyres, FMCG stocks were in demand. European stocks edged lower on Thursday, snapping a three-day winning streak as minutes from the Federal Reserve’s meeting sounded a cautious tone on interest rates. Asian shares rose on Thursday on hopes for China’s emergence from the pandemic. Nifty showed an upward correction within the fall that started in the previous session. This rise could take it to the 18,080-18,120 band post which the downtrend could resume.” – Deepak Jasani, Head of Retail Research, HDFC Securities