The Indian equity benchmarks had weak Tuesday from the get go due to uptick in crude oil prices and unfavourable global cues. Since the market was largely non-directional, analysts warn that the weakness might continue.
"A bearish candle on daily charts and a lower top formation on intraday charts indicate further weakness from the current levels," said Shrikant Chouhan, Head Equity Research at Kotak Securities.
Additionally, International Business Machines Corp.'s disappointing earnings are likely to impact Indian IT sector. IT stocks are likely to remain under pressure when markets open on Wednesday after a sharp selloff in US-listed technology companies.
The caution comes as Infosys and Wipro ADRs tumbled in US trading following IBM's earnings warning, raising concerns about sentiment towards the broader Indian IT sector.
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Accordingly, Nifty's key support lies at 24,000 level, below which selling pressure is likely to accelerate opening up further downside to 23,800-23,750.
On the flipside, immediate resistance for the index is placed at 24,150, above which it can extend upmove to 24,250-24,350 levels.
However, with the Q1FY27 earnings season gathering pace, stock-specific action is likely to dominate, while investors will continue closely monitor key global macro data, as per Siddhartha Khemka, Head of Research, Wealth Management at Motilal Oswal Financial Services.
Nifty Bank
The Bank Nifty index underperformed the benchmark indices on declining by more than 1% and forming a bearish candle on the daily chart. However, the index continues to trade above its key moving averages, pointing to an intact broader trend.
"Going forward, the 56900-56800 zone is expected to act as immediate support for the index. A sustained move below 56800 could intensify selling pressure and lead to a further correction towards the 56200 level. On the upside, the 57800-57900 range remains a crucial resistance area," Sudeep Shah, Head of Technical and Derivatives Research at SBI Securities stated.
Market Recap
Indian equity benchmarks halted their three-day gaining streak amid Nifty's weekly F&O expiry and weak global cues. The NSE Nifty 50 fell 158.95 points, or 0.66%, to 24,052.05. The BSE Sensex declined 561.46 points, or 0.72%, to 77,054.94.
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