The NSE Nifty 50 has exhibited three consecutive sessions of consolidation on the daily chart and a close above the 24,750 mark can act as a trigger for a rally toward the 25,000–25,200 level in the coming days, according to analysts.
"Conversely, the immediate support levels are seen at 24,400 and 24,200, offering potential buying opportunities for market participants," Mandar Bhojane, research analyst at Choice Broking Pvt., said.
In the derivatives segment, the Nifty has seen strong resistance at the 24,800 and 25,000 levels, where significant call open interest was noted. On the put side, the 24,300 level had the highest open interest, indicating solid support, Bhojane said.
The market outlook remains cautiously optimistic, with key levels being watched for clear directional signals in the near term, he added.
Overall, the market sentiment will be influenced by the US inflation data, which is scheduled to be released on Wednesday. The foreign institutional investors have provided a much-needed boost to the broader market.
"We expect the market to largely remain in a broader range with a positive bias, supported by the FII buying and favourable government policies," Siddhartha Khemka, head of research, wealth management, Motilal Oswal Financial Services Ltd., said.
The Bank Nifty has formed a green candle on its daily chart, signifying strength. However, the index is still facing a short-term resistance near the 53,900–54,000 levels, according to Hrishikesh Yedve, assistant vice president of technical and derivatives research at Asit C Mehta Investment Interrmediates Ltd. "If the index sustains above 54,000 levels, then the rally could extend further towards 54,500."
On the downside, the Bank Nifty will find major support at 52,500, where the recent breakout point is placed. As long as the index sustains above 52,500 level, traders are advised to adopt a buy-on-dips strategy, he said.
FII, DII Activity
Overseas investors remained net buyers of Indian equities on Tuesday for the second consecutive session, while domestic institutional investors turned net buyers after a day of selling.
Foreign portfolio investors bought stocks worth approximately Rs 1,286 crore, while the DIIs mopped up stocks worth Rs 605.8 crore, according to provisional data shared by the NSE.
F&O Cues
The Nifty November futures were down by 0.04% to 24,684 at a premium of 74 points, with the open interest down by 0.43%.
The open interest distribution for the Nifty 50 Dec. 12 expiry series indicated most activity at 26,000 call strikes, with the 24,000 put strikes having maximum open interest.
Market Recap
The benchmark equity indices ended on a muted note on Tuesday after declining for the past two sessions, with share prices of Reliance Industries Ltd. and Bharti Airtel Ltd. dragging the most.
The NSE Nifty 50 closed 8.95 points or 0.04% down at 24,610.05, while the BSE Sensex settled 1.59 points up at 81,510.05. During the day, the Nifty declined as much as 0.44% to 24,510.65 and the Sensex fell 0.40% to 81,182.69.
Seven out of the 12 sectors on the NSE advanced. The Nifty Realty rose the most, while Media and Energy declined the most.
Major Stocks In News
Awfis Space Solutions: Investors plan to sell up to 12.2% stake in the company via block deal. The sellers include promoter Peak XV Partners and public shareholder Bisque and Link Investment Trust. The floor price set at Rs 680, which is 5% discount to closing price. The deal value for the block deal is Rs 583.4 crore.
HG Infra Engineering: The company received a letter of acceptance for up-gradation of a highway in Uttar Pradesh worth Rs 763 crore from Ministry of Road Transport and Highways.
Indian Overseas Bank: The company received income tax order worth of Rs 1,359 crore for AY16.
Global Cues
Stocks in the Asia-Pacific region wavered in early session on Wednesday, as traders awaited the key inflation print in the US for further cues.
Japan's Nikkei was 62 points, or 0.16% lower at 39,307, while South Korea's Kospi was up 25 points, or 1% at 2,442 as of 6:40 a.m. Bond yields and US futures contracts rose slightly in the runup to the consumer price index data.
Stocks in China will be in focus as the annual economic work meeting on Wednesday to set out policies for next year. Economists and traders expect further stimulus as the nation changed its monetary stance to "easing" after 11 years. President Xi Jinping said on Tuesday that Beijing is fully confident in achieving its economic growth target this year, Bloomberg News reported.
The South Korean economy will be under pressure as unionised workers at auto factories, railroads and public schools are on strike for the President to step down, after his brief execution of martial law. On Monday, the Justice Department banned the president from travelling overseas.
Meanwhile, Wall Street fell for the second consecutive session on Tuesday, ahead of the CPI inflation data, as traders await further cues to assess the magnitude of the rate cut in the December meeting. Swap trading projects an 80% chance of a quarter-point Fed reduction this month.
The S&P 500 index and the tech-heavy Nasdaq Composite fell 0.30% and 0.25%, respectively, on Monday. The Dow Jones Industrial Average slipped 0.35%.
Treasury 10-year yields rose two basis points to 4.22%. The Bloomberg Dollar Spot Index added 0.1%.
Oil was steady ahead of the monthly report from OPEC. The Brent crude was trading 0.10% higher at $72.26 a barrel as of 6:00 a.m. IST, and the West Texas Intermediate was up 0.10% at $68.66.
Key Levels
US Dollar Index at 106.39.
US 10-year bond yield at 4.23%.
Brent crude up 0.07% at $72.19 per barrel.
Bitcoin was down 0.5% at $96,422.38.
Gold spot up 0.15% at $2,698.19.
Money Market Update
The Indian rupee weakened by 12 paise to close at a record closing low of 84.85 against the US dollar on Tuesday.
During the day, the rupee weakened by 13 paise to a fresh record low of 84.86 against the greenback during the trade after it opened lower on Tuesday. The domestic current had opened at a low of 84.79, weakening by 6 paise from its previous close.
Disclaimer: The views and opinions expressed by the investment advisers on NDTV Profit are of their own and not of NDTV Profit. NDTV Profit advises users to consult with their own financial or investment adviser before taking any investment decision.
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