Share Market Today | Gift Nifty Negative, Weak Global Cues

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Synopsis:

Today’s latest market updates include: HCLTech buys ₹1874 Cr HP Enterprise's Communications Technology Group assets, ZEE Entertainment demands ₹749 Cr termination fee,  GPT Infra bags ₹550 Cr RVNL project, JSW’s paint business becomes profitable, plus other global market news.

Latest Market News

  1. HCLTech buys Hewlett Packard Enterprise's Communications Technology Group assets for ₹1874 crore.
  2. ZEE Entertainment demands a ₹749 crore termination fee from Culver Max and Bangla Entertainment.
  3. GPT Infra was declared the lowest bidder for a ₹550 crore project from RVNL.
  4. JSW Group's paint business becomes profitable and targets ₹5,000 crore in sales by FY26.
  5. US initial jobless claims for the week ending May 18 dropped to 2.15 lakh from 2.23 lakh the previous week.
  6. FIIs net bought ₹4,670.95 crore while DIIs net bought ₹146.5 crore in equities yesterday.

Additional ReadHow to Invest in US Stocks from India

In-Depth Market Insights: Global Outlook, Derivatives & More

US Share Market News

  1. Performance Overview:

Stock markets took a nosedive on Thursday afternoon, dropping sharply after initially hitting record highs driven by Nvidia Corp.'s impressive AI-powered earnings report.

  1. Economic Indicators:

The Fed's signals about persistent inflation concerns suggest any rate cuts this year could be postponed.

The CBOE Volatility Index (VIX), nicknamed the market fear gauge, rose by over 7% following its dip to the lowest point since November 2019 earlier today.

  1. Sector-Specific Movements:

The Dow Jones Industrial Average had its toughest day of the year, slipping by 1.53%, led by Boeing's 7.6% drop, making it the biggest loser in the index. The S&P 500 fell by 0.74%, while the Nasdaq Composite stumbled by 0.39%.

Other Asset Classes

  1. Treasury Yields:

On Thursday, the US Treasury yields rose after strong economic data. The 10-year yield climbed 4 basis points to 4.479%, and the 2-year yield increased nearly 6 basis points to 4.935%.

  1. Currency:

The dollar gained strength against the euro as US business activity surged to its highest level in over two years in May. This suggests a boost in economic growth midway through the second quarter. The dollar index closed the session up by 0.2% at 104.90.

  1. Commodities:

Crude oil futures dropped for the fourth straight session on Thursday, just before the busy Memorial Day travel weekend. US crude is down 3% for the week, while Brent, the global benchmark, has fallen around 4%.

Gold fell to a one-week low on Thursday, marking its third consecutive decline. Investor concerns about US rate cuts and strong US business activity drove the drop. Spot gold decreased 2.1% to $2,328.61 per ounce. Earlier in the week, it reached a record high of $2,449.89 and has risen 14% this year.

Asian Markets

  1. General Trends:

Asia-Pacific markets dropped in early Friday trading following a sharp decline on Wall Street, despite a strong post-earnings rally from tech giant Nvidia.

Investors analysed Japan's April inflation data for insights into potential moves by the Bank of Japan.

  1. Specific Index Performance:

The Nikkei 225 dropped 1.33% following the CPI announcement, and the broader Topix index fell 1.22%.

In South Korea, the Kospi declined by 1.34%, and the small-cap Kosdaq decreased by 0.95%.

India Market Outlook

  1. GIFT Nifty Projection:

Gift Nifty indicates a negative opening for the Indian market due to weak global cues. Following a recent sharp rise, the Nifty spot is expected to consolidate its gains and trade within the 22,850-23,050 range.

  1. Nifty Short-Term Outlook:

Benchmark indices extended their gains for the sixth consecutive session, with Nifty breaking its previous high of 22,794 and reaching a new milestone of 22,993. Nifty ended the day at 22,967, up 1.60%, while Bank Nifty outperformed, closing at 48,768.80, up 2.06%.

A sizable bull candle on the daily chart indicates continued positive momentum, although stochastics are overbought at 93. If the index maintains higher highs and higher lows, it could reach the target of 23,300.

After ten consecutive sessions of gains, some consolidation between 23,100-22,700 is possible and should be seen as a buying opportunity.

  1. Intraday Levels:

Nifty: Intraday resistance is situated at 22990, followed by 23050 levels. Conversely, downside support is located at 22880, followed by 22800.

Bank Nifty: Intraday resistance is positioned at 48830, followed by 49000, while downside support is found at 48570, followed by 47400.

Fin Nifty: Intraday resistance is positioned at 21760, followed by 21840, while downside support is found at 21630, followed by 21550.

Derivative Market Analysis

  1. Nifty:

The highest call OI addition is at the 23,500 level, indicating a resistance zone, with immediate call OI at 23,000. Significant put OI additions at 22,500, 22,700, and 22,800 suggest strong support levels.

Option chain analysis shows active put writers below 22,800 and call writers moving to higher levels, implying a positive outlook.

The put-call ratio has risen by 0.17 to 1.37. Additionally, the Nifty experienced a 6.0% increase in open interest and a 1.5% rise in price, signifying a long build-up.

  1. Bank Nifty:

The Bank Nifty option chain analysis suggests strong support at the 48,500 level due to significant put OI addition, with the highest put OI at 48,000. Put writers have moved to higher levels, and call unwinding below 48,500 indicates a bullish sentiment.

On the resistance side, the highest call OI addition is at 50,000, with immediate resistance at 49,000. The immediate trading range for the Bank Nifty is 48,000 to 49,000, with the potential for a directional move if this range is breached.

Additionally, a 0.5% decline in open interest alongside a 1.8% price increase suggests short covering.

Stay on top of the latest market news with Bajaj Broking’s insights. Our point-to-point expert analysis digs deep into the surface, empowering you with a unique perspective on the events in the domestic as well as the global stock market. Get all the current share market news, including US share market updates in one place and make wise investment decisions.

Disclaimer: Investments in the securities market are subject to market risk, read all related documents carefully before investing.

This content is for educational purposes only. Securities quoted are exemplary and not recommendatory.

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