Sensex falls for 4th day straight, Nifty support at 16907; investors eye crude oil prices, RBI MPC meet

Sensex falls for 4th day straight, Nifty support at 16907; investors eye crude oil prices, RBI MPC meet

BSE Sensex and NSE Nifty 50 ended in negative territory for the fourth consecutive trading day on Tuesday. BSE Sensex fell 38 points or 0.01 per cent at 57108, while NSE Nifty 50 ended 9 points down at 17007. Index heavyweights such as ICICI Bank, HDFC Bank, Kotak Mahindra Bank, Housing Development Finance Corporation (HDFC), and State Bank of India (SBI), among others contributed the most to the indices’ loss. Broader markets outperformed equity frontliners. S&P BSE MidCap index ended flat at 24,554, while the S&P BSE SmallCap index gained 137 points or 0.5 per cent to settle at 27,991. India VIX, the volatility index, fell 1.5 per cent to settle at 21,57 levels.

Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities

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Deepak Jasani, Head of Retail Research, HDFC Securities

Global markets remained on edge and were mixed Tuesday as investors braced for a heightened risk of global recession, even as dip buyers emerged. Chinese markets recovered on expectations of more stimulus measures by the government. People’s Bank of China injected about $24.7 billion of liquidity into the sector via repo market operations. Nifty took support from the upgap of 16947 and closed flat after making a lower low compared to the previous day. The downtrend in the Nifty may have halted temporarily, though it needs to close above 17196 for confirmation. On falls, 16942 will be watched closely.

Rupak De, Senior Technical Analyst, LKP Securities

The benchmark Nifty remained range bound ahead of the RBI policy meet. The index briefly slipped below 16950 as it failed to sustain at the lower level leading to a close above 17000. On the lower end, bulls have managed to protect the 200 DMA on a closing basis. The momentum indicator is in a bearish crossover. The trend remains weak; however, the proximity to the crucial support may induce a pullback in the market. On the higher end, resistance is visible at 17150-17200. Above 17200, the Nifty may move towards 17500. On the other hand, a decisive fall below 16950 may trigger a panic button.

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Vinod Nair, Head of Research, Geojit Financial Services

In search of a safer dollar and elevated bond yields, foreign investors are withdrawing from Indian equities, resulting in the decline of the domestic market. In contrast to the recent trend of sector performance, banks and autos are exhibiting negative bias, while IT and pharma are showcasing resilience. Crude prices are closing down, despite expectations that OPEC+ will take more action to cut production in the coming meeting, due to the weakening global economy.

Prashanth Tapse – Research Analyst, Senior VP (Research), Mehta Equities

Volatility was the hallmark of today’s trade as on backdrop was the risk of recession in financial markets across the globe. The street suspects that the Fed will move so aggressively as to cause a recession. The other biggest headwind that markets across the globe face is inflation. Traders will now spy with one big eye on how much the RBI will tighten monetary policy—and raise interest in its meeting on Friday to tackle inflation in the remaining year. Technically, the biggest support to watch on Nifty will be at 16907. As long as 16907 support is held, there is a bright chance that Nifty could bounce to 17347 and then at the 17727 mark.