Trade Setup For Jan. 9: Nifty Pullback Likely To Continue Above 23,500

The NSE Nifty 50 can continue its pullback and information-technology stocks are expected to be in focus as the earnings season for the third quarter of the current financial year begins, according to analysts.

If the Nifty is trading above 23,500, the pullback formation is likely to continue, according to Shrikant Chouhan, head equity research at Kotak Securities. "On the upside, it could bounce back to around 23,800."

The gains can continue, potentially driving the index towards the 200-day simple moving average, which is around the 23,925 level, Chouhan said. "The sentiments could change if Nifty 50 falls below 23,500 levels and traders may prefer to exit out from the trading long positions."

Information technology stocks will be in focus on Thursday as Tata Consultancy Services Ltd. kicks off the results season, according to Siddhartha Khemka, head of research, wealth management, at Motilal Oswal Financial Services Ltd. "We expect Indian markets to remain range-bound with stock/sector specific action on the back of upcoming Q3 results."

The Indian equities sailed through a volatile session on Wednesday to end flat as the benchmark Nifty found vital support. A reversal of declines in information-technology stocks helped offset losses in pharma and financials.

The NSE Nifty 50 ended 18.95 points or 0.08% lower at 23,688.95, while BSE Sensex lost 50.62 points or 0.06% to close at 78,148.49.

Foreign portfolio investors stayed net sellers for the fourth straight session on Wednesday and sold stocks worth Rs 3,362.2 crore, according to provisional data from the National Stock Exchange.

Domestic institutional investors stayed buyers for the 16th consecutive session and bought stocks worth Rs 2,716.3 crore.

The Nifty January futures were down by 0.08% to 23,776.35 at a premium of 87 points, with the open interest up by 2.19%.

The open interest distribution for the Nifty 50 Jan. 9 expiry series indicated most activity at 24,000 call strikes, with the 23,000 put strikes having maximum open interest.

• Tata Motors: JLR shipped more cars, but fewer were registered in October-December 2024, even as supply disruptions eased. Wholesales of the luxury unit of India’s Tata Motors Ltd. rose 3% over the year-ago period to 104,427 units in the third quarter of the fiscal ending March 2025. Sequentially, dispatches were up 20%. Registrations of JLR cars fell 3% year-on-year to 106,334 units in October-December 2024.

• BHEL: The company has successfully commissioned two units of a hydroelectric project in Bhutan.

• Poonawalla Fincorp: The company has approved raising up to Rs 190 crore through bonds.

Stocks in the Asia-Pacific region slipped on Thursday taking overnight cues from a volatile start to Wall Street in 2025 ahead of Friday’s jobs report.

Japanese markets opened lower with the benchmark Nikkei falling by 0.56%, or 225 points, to 39,755 as of 6:50 a.m. South Korea's Kospi was up 2.6 points, or 0.11%, at 8,523. Future contracts in Mainland China pointed to a positive start while those in Hong Kong hinted lower open.

The equity benchmark in China closed lower on Wednesday ahead of its inflation reading. Headline CPI is expected to weakened further while factory-gate prices stayed well below year-earlier levels, according to Bloomberg.

On Thursday the US observes a federal holiday for the state funeral of former President Jimmy Carter, with President Joe Biden expected to deliver a eulogy. Seven & i Holdings, parent of 7-Eleven, will announce its earnings.

Meanwhile, most Federal Reserve officials said it was appropriate to lower the benchmark rate, according to the latest minutes of the Dec. 17-18 meeting. Participants expected to move toward neutral over time and most saw policy as significantly less restrictive.

US private-sector hiring and wage growth slowed in December, the least in four months, indicating an ongoing moderation in demand for workers. Employment rose by 1.22 lakh last month, following a 1.46 lakh increase in November.

The S&P 500 topped the 5,900 psychological mark after briefly falling below it. The S&P 500 and Dow Jones Industrial Average fell 0.16% and 0.25%, respectively. The tech-heavy Nasdaq Composite slipped 0.06%.

The dollar index — which tracks the greenback's performance against a basket of 10 leading global currencies — was trading lower by 0.09% at 108.9.

Crude oil prices steadied after a volatile session on Thursday. The Brent crude was trading 0.34% lower at $75.90 a barrel as of 7:03 a.m. IST, and the West Texas Intermediate was down 0.40% at $73.03.

The Indian rupee weakened 14 paise to close at 85.86 against the US dollar on Wednesday. It hit a record low of 85.846 during the day after opening at 85.82.

The domestic currency had closed at 85.72 against the greenback on Tuesday