GIFT Nifty traded mildly higher during Thursday’s early trading session at 19,626, indicating a flat opening for domestic indices NSE Nifty 50 and BSE Sensex. Indian equity indices NSE Nifty 50 and BSE Sensex closed in the green on Wednesday after trading in the red, extending gains for the fourth session. Nifty 50 ended at 19,611.05, adding 0.16% while Sensex rose 100 points to close at 65,880.52.
“A spike in crude oil reverberated across the globe, reviving concerns about inflation and sparking fears of a Fed rate hike. This led to a surge in U.S. bond yields, causing investors to shift towards the safety of bonds and reversing the buying trend of foreign investors in the domestic market. Nevertheless, the resilience of the domestic markets shone through as investors placed their bets on an improved outlook, ultimately helping the market recover from the initial shock,” said Vinod Nair, Head of Research at Geojit Financial Services.
Asian Markets
Asian-Pacific markets traded in the red on Thursday. Chinese indices had a minor decline, with the Shanghai Composite dropping by 0.28% and the Shenzhen Component down by 0.7%. In Japan, the Nikkei-225 saw a slight dip of 0.15%. However, Hong Kong’s Hang Seng index took a hit, decreasing by 0.61%, while South Korea’s KOSPI also fell, though by a larger 0.79%.
Crude Oil
Oil prices edged higher on Thursday, after industry data showed U.S. crude oil inventories were expected to have fallen last week, signaling tightening supplies on top of extended production cuts in Saudi Arabia and Russia.
FII/DII Data
Foreign institutional investors (FII) sold shares worth net Rs 3,245.86 crore, while domestic institutional investors (DII) offloaded shares worth net Rs 247.46 crore on 5 September, according to the provisional data available on the NSE.
F&O Ban
The National Stock Exchange has Balrampur Chini Mills, Manapurram Finance, SAIL, Delta Corp, Indiabulls Housing Finance, India Cements, Hindustan Copper and BHEL securities on its F&O ban list for 6 September. According to the NSE, stocks are prohibited in the F&O sector when they have exceeded 95% of the market-wide position limit (MWPL). During the F&O ban period, no new positions are permitted for F&O contracts in that stock.
Bank Nifty Outlook
“Bank Nifty has also witnessed a sharp pullback. It has held on to its 20 week moving average support (44,144) and also closed in the green. We expect the pullback to continue over the next week as well. Daily and Hourly momentum indicators have a positive crossover which is a buy signal. We expect Bank Nifty to target levels of 45,000 from a short term perspective,” said Jatin Gedia – Technical Research Analyst at Sharekhan by BNP Paribas.
Technical View
“The short term trend of Nifty continues to be positive. One may expect further upside in the coming sessions and any dips down to the support of 19,500 is likely to be a buy on dips opportunity. The next upside levels to be watched are around 19,800,” said Nagaraj Shetti, Technical Research Analyst, HDFC Securities.
(With agency inputs.)