Story by Dev Sethia 

GIFT Nifty indicated that Indian equity indices BSE Sensex and NSE Nifty 50 may see a negative opening on Thursday. Here’s a look at the key stocks to watch in trade.

GIFT Nifty traded down by 153 points or 0.72% at 20,064, indicating a negative opening for domestic indices NSE Nifty 50 and BSE Sensex on Thursday. Previously, on Wednesday, the NSE Nifty 50 slumped 302.95 points or 1.41% to settle at 21,150.15, while the BSE Sensex dropped by 930.88 points or 1.30% to 70,506.31.

“Markets witnessed a bout of profit taking and lost nearly one and a half percent, in continuation to the prevailing corrective phase.  After the initial uptick, Nifty hovered in a range in the first half however a sharp cut in the heavyweights across sectors completely turned the tone. It eventually settled closer to the day’s low at 21,150 levels.  Among the key sectors, metal, energy and realty were among the top losers. Besides, the broader indices too felt the heat and lost over 3.5% each,” said Ajit Mishra, SVP – Technical Research, Religare Broking Ltd.

 Mishra also added that, This is the first serious slide in the Nifty index after the seven weeks of up move and it may result in further dip. However, it is too early to conclude the uptrend has faded until the Nifty breaks 20,700 i.e. 20 EMA on the daily chart. We reiterate our preference for index majors and suggest accumulating quality names during this phase. At the same time, the pressure could be higher in the midcap and smallcap space so participants should reduce their positions and maintain strict stop losses in remaining trades. 

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Key things to know before share market opens on December 21, 2023

Wall Street

U.S. Treasuries clung to gains while stocks strove to hold onto a rebound after a fresh batch of data left traders measuring the chances of a soft landing for the world’s largest economy, reported Bloomberg. The tech-heavy Nasdaq Composite dropped 168.85 points or 1.13% at 14,834.37. The S&P 500 plunged 51.50 points or 1.08% at 4,716.87, while the Dow Jones Industrial Average slumped 343.76 points or 0.92% to 37,214.16.

US Dollar 

The US Dollar Index (DXY), which measures the value of the dollar against a basket of six foreign currencies, traded down by 0.05% at 102.36.

Crude Oil 

WTI crude prices are trading at $73.64 down 0.78%, while Brent crude prices are trading at $78.91 down by 0.99%, on Thursday morning.

Asian Markets

Shares in the Asia-Pacific region are trading in the mixed territory on Thursday morning. The Asia Dow is trading up by 0.55%, Japan’s Nikkei 225 is red, down 1.54%, Hong Kong’s Hang Seng index is trading up 0.66% and the benchmark Chinese index Shanghai Composite is trading lower by 1.03%.

FII, DII Data

Foreign institutional investors (FII) offloaded shares worth net Rs 1,322.1 crore, while domestic institutional investors (DII) bought shares worth net Rs 4,754.3 crore on December 20, 2023, according to the provisional data available on the NSE.

F&O Ban

The NSE has added Ashok Leyland, India Cements, Manappuram Finance, SAIL, Balrampur Chini, NALCO, Indus Towers, Delta Corp, Piramal Enterprises and RBL bank to its F&O ban list for December 21, 2023.

Technical View

Commenting on the Technical outlook of  Rupak De, Senior Technical analyst at LKP Securities, said, The Nifty experienced a sharp correction as bearish sentiment persisted. It failed to sustain above 21500, resulting in increased call writing at the 21500 strike, subsequently leading to a significant downturn. At its lowest point, the Nifty dropped just below 21100 before recovering to close above that level. Looking ahead, there might be a consolidation phase for the Nifty in the near term. Resistance is expected around 21500, while support is anticipated at 21100.

Bank Nifty Outlook

“The Bank Nifty index experienced intense selling pressure, resulting in the formation of a bearish engulfing candle on the daily chart. The immediate resistance for the index is situated at the 47600-47700 zone, and a breakthrough above this level could pave the way for further upside, targeting 48000. However, the overall sentiment remains bearish, suggesting a cautious approach with a preference for selling on any upward movements,” said Kunal Shah, Senior Technical & Derivative analyst at LKP Securities.

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