Bears are likely to tighten their grip further amid weak global cues. As FPIs selling continued aggressively, analysts expect the downtrend to continue, as geopolitical tension continued to hurt sentiment. The firm interest rate regime and fight to safety push FPIs to book profits from Indian markets, they added. Besides, most stocks from Mid and Small-cap space turned weak technically too.
Ruchit Jain, Lead Research, 5paisa.com, said: Our market has continued the corrective phase and has breached the important supports at the start of the week. The follow up selling in the large caps as well the broader markets hints at a continuation of this corrective phase. “Now the data remains negative as more than 70 percent of the positions of FIIs in the index futures segment are still on the short side. It needs to be seen how much of these positions are rolled to the November series,” he added.
Gift Nifty at 19,107 indicates a further fall for domestic markets. Nifty October futures and November futures closed at 19128 and 19224.95. Following overnight sharp correction in the US stocks, Asian stocks are down in early deal on Thursday.
Siddhartha Khemka, Head - Retail Research, Motilal Oswal Financial Services Ltd, said: Domestic equities saw profit booking and slipped to 3-months low. Profit booking continued in mid-cap and small-cap stocks. Metal stocks were in momentum after China unveiled plans for $137 billion extra debt to boost infrastructure spending. “Overall we expect Indian markets to remain volatile on the back of concerns over higher interest rates, ongoing Israel-Hamas war and mixed Q2 results. On global front, investors will take cues from ECB interest rate decision on Thursday,” he said.
Arvinder Singh Nanda, Senior Vice President, Master Capital Services Ltd, said: Nifty prices fell sharply, extending losses for the fifth day in a row. “Prices toppled below their crucial support of 19230 with likely to pave the way for 19050 and then 19000. On the higher side, 19230-19250 will act as an immediate resistance,” he said.
Bank Nifty prices are likely to find support near 43000, while resistance aligns near 43350.
“One key factor contributing to the market’s sharp fall is the deteriorating global market sentiments, primarily attributed to the ongoing conflict between Israel and Hamas. Moreover, a rebound in the U.S. 10-year bond yield which recouped sharply from a five-day low, and weakness in banking stocks has further dampened investor sentiments,” he added.