Stock Market Outlook: Ahead of Market: 10 things that will decide D-Street action on Monday

With progress seen in the debt ceiling negotiation in the US, Indian equities mirroring world markets advanced. Also, gains in the heavyweight Reliance Industries and IT giants propelled Nifty to scale to 18,500 levels, marking gains of around 1%. Meanwhile, Nifty Bank and broader markets underperformed the headline indices.

Here’s how analysts read the market pulse:
“Despite weak cues from global markets, the domestic market defied the trend and experienced a widespread rally, driven by the strong growth forecast for the Indian economy. With the upcoming Q4 GDP data, it is anticipated that India’s FY23 GDP will marginally surpass the earlier projected 7.0% growth rate. Additionally, the expectation of a normal monsoon and consistent FII buying further boosted confidence among domestic investors,” Vinod Nair, Head of Research at Geojit Financial Services, said.

“Nifty might face some near-term resistance between 18700 and 18800, but that would only be a speed-breaker in the scheme of things. The OI of the Puts have already started rising in the June month expiry right from the 18100, 18200, and 18,300 levels, and the final push will come once you see the 18,500 puts get written,” Rahul Ghose, Founder & CEO – Hedged.
That said, here’s a look at what some key indicators are suggesting for Monday’s action:

Global Markets
Wall Street‘s main indexes rose and European shares logged their largest one-day gain in two months on Friday as talks on raising the U.S. debt ceiling progressed. The Dow Jones Industrial Average rose 1.00% to 33,093.34, the S&P 500 gained 1.30% to 4,205.45 and the Nasdaq Composite climbed 2.19% to 12,975.69.

The pan-European STOXX 600 index closed 1.2% higher, bouncing back from Thursday’s eight-week low. Swedish gaming company Embracer jumped 13.1% to top the index, and Faurecia added 7.5% after Jefferies upgraded the French car parts maker to “buy”.

Tech View: Bullish candle
Nifty, which has been forming higher highs from the last nine weeks, today formed a bullish candle on the weekly charts as it broke out of the sideways consolidation move.

Now it has to hold above 18442 zones for an up move towards 18600 and 18888 zones, while on the downside, support exists at 18333 and 18281 zones, said Chandan Taparia of Motilal Oswal.

Stocks showing bullish bias
Momentum indicator Moving Average Convergence Divergence (MACD) showed bullish trade on the counters of Zomato, Zee Entertainment, IDFC First Bank, NALCO and Indus Towers, among others.

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 signaling weakness ahead
The MACD showed bearish signs on the counters of Coffee Day Enterprises, KPI Green Energy, NCL Industries, Cyient and Sobha, among others.

A bearish crossover on the MACD on these counters indicated that they had just begun their downward journey.

Most active stocks in value terms
HDFC Bank (Rs 2146 crore), HDFC (Rs 1651 crore), Page Industries (Rs 1523 crore), RIL (Rs 1451 crore) and ICICI Bank (Rs 1035 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 the highest trading turnovers in the day.

Most active stocks in volume terms
Suzlon Energy (Shares traded: 14.93 crore), Zomato (Shares traded: 8.64 crore) , Vodafone Idea (Shares traded: 7.83 crore), IRFC (Shares traded: 5.23 crore) and Zee Entertainment (Rs 4.68 crore) among the most traded stocks in the session on NSE.

Stocks showing buying interest
Shares of VRL Logistics, Varun Beverages, Cummins India and Glenmark Life witnessed strong buying interest from market participants as they scaled their fresh 52-week highs, signalling bullish sentiment.

Stocks seeing selling pressure
Shares of Page Industries, Aavas Financiers, Saregama India and Zee Entertainment, among others, hit their 52-week lows, signalling bearish sentiment on the counters.

Sentiment meter favours bulls
Overall, market breadth favoured bears as 1,907 stocks ended in the green, while 1,600 names settled with losses.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)

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