NEW DELHI: The market continues to be under pressure amid soaring inflation and a sell-off in shares globally. Analysts believe this is the right time to pick quality stocks at a cheap valuation.
Here’s how analysts read the market pulse:
Thursday’s trade certainly caught momentum traders off guard, said Sameet Chavan of Angel One, noting that many traders would have carried over their longs after Tuesday’s sharp rebound.
Independent Analyst Manish Shah said that the index found support at 15,750 a couple of times in the last 4-5 days, which makes the pattern a tweezers bottom.
That said, here’s a look at what some key indicators are suggesting for Friday’s action:
US stocks bounce back in choppy trade
US stocks erased declines in a choppy morning session as traders weighed prospects for growth against a backdrop of rising prices eroding earnings and tightening monetary policy. Haven demand pushed Treasuries higher.
The S&P 500 traded higher, a day after the biggest single-day drop since June 2020 on Wednesday that erased $1.5 trillion from its market value. The tech-heavy Nasdaq 100 climbed more than 1%. The Dow Jones Industrial Average lost 83 points, or 0.2%.
European stocks drop
European stocks extended declines as a sharp selloff in US equities fueled concerns of an economic slowdown and further dented demand for risk assets.
The Stoxx Europe 600 Index was down 2% as of 12:01 p.m. in London after the S&P 500 posted its biggest drop in almost two years.
Tech View: Bearish candle
Nifty50 saw a gap-down start and intensified selling as the session progressed. It ended up forming a small bearish candle on the daily chart. Analysts said the strong support for the index is seen in the 15-750-15,650 range.
F&O: Resistance at 16,000
On the call side highest OI was witnessed at 15,900, followed by a 16,000 strike price, while on the put side, the highest OI was at 15,000, followed by a 15,800 strike price, providing support to the Nifty index.
Stocks showing bullish bias
Momentum indicator Moving Average Convergence Divergence (MACD) showed a bullish trade setup on the counters of
, , ITC, , Gujarat Pipapav and .
The MACD is known for signaling trend reversals in traded securities or indices. When the MACD crosses above the signal line, it gives a bullish signal, indicating that the price of the security may see an upward movement and vice versa.
Stocks signalling weakness ahead
The MACD showed bearish signs on the counters of
, , , , Zee Entertainment and Infosys. A bearish crossover on the MACD on these counters indicated that they had just begun their downward journey.
Most active stocks in value terms
Infosys (Rs 2,380 crore), ITC (Rs 2,148 crore),
(Rs 1,692 crore), (Rs 1,572 crore), TCS (Rs 1,532 crore), (Rs 1,321 crore) and (Rs 1,153 crore) were among the most active stocks on NSE in value terms. Higher activity on a counter in value terms can help identify the counters with highest trading turnovers in the day.
Most active stocks in volume terms
(Shares traded: 16 crore), (Shares traded: 16 crore), ITC (Shares traded: 8 crore), JP Power (Shares traded: 5 crore), SAIL (Shares traded: 4 crore) and Visesh Info (Shares traded: 3 crore) were among the most traded stocks in the session on NSE.
Stocks showing buying interest
ITC and MRPL stocks witnessed strong buying interest from market participants as they scaled their fresh 52-week highs, signalling bullish sentiment.
Stocks seeing selling pressure
Wipro, HDFC Bank, BPCL and
witnessed strong selling pressure and hit their 52-week lows, signalling bearish sentiment on the counters.
Sentiment meter favours bears
Overall, market breadth favoured losers as 779 stocks ended in the green, while 2,557 names settled with cuts.