Share Market Today | Gift Nifty Down Amidst Global Weakness

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Synopsis:

Today’s latest market updates: S&P’s positive outlook on India, Aditya Birla Capital invests ₹300 Cr in Aditya Birla Housing Finance, General Atlantic Singapore sells 6.8% stake in Kfin Tech, TPG Asia plans ₹1,000 Cr stake sale in RR Kabel, plus other global market news.

Latest Market News

  1. S&P upgrades India's outlook to positive, rating remains affirmed.
  2. Aditya Birla Capital invests ₹300 crore in Aditya Birla Housing Finance via rights issue.
  3. General Atlantic Singapore fund may sell up to a 6.8% stake in Kfin Tech.
  4. TPG Asia plans to sell its entire 5% stake in RR Kabel for ₹1,000 crore.
  5. RITES anticipates more export orders and plans to bid aggressively internationally.
  6. Infosys introduces AI innovations for Roland-Garros 2024 with the French Tennis Federation.
  7. Nava's Zambian unit, Maamba Collieries, to add 300 MW capacity for $400 million.
  8. FIIs sold ₹5,841.84 crore while DIIs bought ₹5,233.79 crore in equities yesterday.

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

US Share Market News

1. Performance Overview:

  • On Wednesday, Wall Street indexes dropped due to ongoing worries about high interest rates, especially with key inflation data looming on Friday. Stocks saw profit-taking after hitting record highs in May.
  • Treasury yields spiked sharply, and industrials weakened, with airline stocks taking a hit after American Airlines lowered its Q2 profit outlook, sparking concerns about demand.

2. Economic Indicators:

  • Treasury yields are rising ahead of crucial inflation data this week. The PCE price index is due Friday and will influence their rate outlook. Officials are cautious about lowering rates amid signs of persistent inflation at decades-high levels.
  • Before the PCE data release, we anticipate a resilient first-quarter GDP update on Thursday, suggesting the US economy has enough strength for the Fed to maintain higher rates for an extended period.

3. Sector-Specific Movements:

  • The S&P 500 dropped 0.7% to 5,266.95, and the NASDAQ Composite slipped 0.6% to 16,920.58 after recent record highs. Meanwhile, the Dow Jones Industrial Average fell 1.1% to 38,441.54.

Other Asset Classes

1. Treasury Yields:

  • On Wednesday, the US Treasury yields rose as investors assessed the economy and reacted to a weak five-year note auction. The 10-year yield hit 4.614%, its highest since early May, while the 2-year yield reached 4.975%.

2. Currency:

  • The US dollar rose slightly ahead of key inflation data, boosted by expectations that the Federal Reserve will delay interest rate cuts. The Dollar Index was up 0.5% at 105.10.

3. Commodities:

  • Oil prices fell about 1% on Wednesday due to concerns over weak US gasoline demand and economic data suggesting the Federal Reserve might keep interest rates higher for longer. Brent futures dropped 0.74% to $83.60 a barrel, and US WTI crude decreased 0.75% to $79.23 a barrel.
  • Gold prices fell on Wednesday, pressured by a stronger dollar, rising bond yields, and hawkish remarks from a Federal Reserve official. Ahead of Friday's US inflation data release, spot gold dropped nearly 1% to $2,338.43 per ounce, while US gold futures slipped 0.7% to $2,361.50.

Asian Markets

1. General Trends:

  • Asia-Pacific markets continued to decline on Thursday, following Wall Street's lead as investors awaited key economic data from the region due on Friday.

2. Specific Index Performance:

  • Japan's Nikkei 225 dropped over 2%, and the Topix fell 1.4% in early trading.
  • South Korea's Kospi declined nearly 1%, while the Kosdaq slipped 0.6%.

India Market Outlook

1. GIFT Nifty Projection:

  • Gift Nifty is expected to open slightly lower due to weak global signals. The index will likely continue its recent consolidation between 22570 and 22800. A move above 22800 would indicate a break in the current downward trend.

2. Nifty Short-Term Outlook:

  • Nifty extended its corrective decline for the third consecutive session on Wednesday, closing down 0.8% at 22,715 amid soft global cues, with Bank Nifty underperforming, closing down 1.3% at 48,500.
  • While the broader market, including Nifty Midcap and Smallcap, remained relatively flat, the index formed a bearish candle with a lower high and lower low for the second session in a row, indicating continued consolidation and corrective bias.
  • Volatility is expected to persist ahead of the General election outcome and the progression of the Q4 earnings season. To signal a pause in the decline, Nifty needs to form higher highs and lows, with a target area of 23,300 based on a 150% external retracement.
  • Current dips are seen as buying opportunities, with key support at 22,400, aligning with the 50-day EMA and last week's low.

3. Intraday Levels:

  • Nifty: Intraday resistance is situated at 22750, followed by 22830 levels. Conversely, downside support is located at 22610, followed by 22550.
  • Bank Nifty: Intraday resistance is positioned at 48660, followed by 49000, while downside support is found at 48230, followed by 48050.
  • Fin Nifty: Intraday resistance is positioned at 21660, followed by 21740, while downside support is found at 21520, followed by 21440.

Derivative Market Analysis

1. Nifty:

  • For the monthly expiry, the highest call OI addition is at 23,000, followed by 22,800, indicating immediate resistance levels. Active call writers above 22,800 suggest multiple resistance zones.
  • On the downside, significant put OI additions have shifted to 22,000, with immediate support at 22,500. The option chain analysis shows put writers unwinding their positions and dominance of call writers above 22,800, implying limited upside potential.
  • The Nifty is expected to move between 22,500 and 22,800, with a breakout likely to trigger a further directional move.
  • The put-call ratio has decreased to 0.79, with Nifty experiencing a 1.6% decline in open interest and a 0.8% price drop, indicating long unwinding.

2. Bank Nifty:

  • The accumulation of both call and put OI at the 49,000 level indicates a straddle formation, making it a key deciding point for the day.
  • Significant put OI addition at 49,000 suggests that falling below this level could lead to a decline towards 48,500, while the highest call OI addition at 49,000 indicates strong resistance.
  • The option chain analysis points to an immediate trading range for Bank Nifty between 48,500 and 49,000, with a potential for further directional movement if this range is broken.
  • Additionally, the put-call ratio has risen to 0.93, and Bank Nifty has seen an 18.9% drop in open interest alongside a 2.1% price decrease, indicating long unwinding.

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 and global stock markets. 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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