Market Watch: Weak opening expected for Indian markets today amid weak handover

Caution is advised in initiating new long positions until the index surpasses the crucial 21,950 levels which pose significant resistance, according to technical experts.

The US markets ended with sharp cuts overnight after the hotter than expected CPI inflation spooked the sentiment. Indian markets today are also likely to take cues from the global markets and are expected to open lower. Back home on Tuesday, both Sensex and Nifty ended the session saw a sharp recovery and ended near the day’s high, led by heavyweight Reliance Industries and ICICI Bank. The Nifty closed at 21,743, up 127 points, while Sensex ended Tuesday’s session at 71,555, higher by 482 points. The Nifty Bank surged 620 points to end at 45,502.

Nifty bounced back from yesterday’s losses after India’s CPI inflation came in at a 3-month low of 5.10%. The index closed with gains of 127 points (+0.6%) at 21743 levels. All sectors ended in green, except Metals. Banking and Financial Services were top gainers. PSU sector bounced back after witnessing profit booking over the last few sessions. On the other hand, Reliance became the first Indian company to cross Rs.20 lakh market cap. MSCI Global Standard Index saw a quarterly rejig today that could lead to inflows of nearly $1 billion from passive FII funds,” said Siddhartha Khemka of Motilal Oswal Financial Services.

On the technical front, Om Mehra of Samco Securities, says, “Caution is advised in initiating new long positions until the index surpasses the crucial 21,950 levels which pose significant resistance. Weekly analysis indicates the index hovering below the middle Bollinger band with potential support identified in the 21,550-21,500 zone.”

Foreign Institutional Investors on Tuesday added shares worth Rs 376.32 crore in the cash markets. On the other hand, flows from DIIs remained positive too as they added shares worth Rs 273.94 crore, provisional data from exchanges showed.

Top stocks to watch today are Zee Entertainment, BEL, IRCTC, Eris Lifesciences, Jana Small Finance Bank, Capital Small Finance Bank, Rashi Peripherals. 

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