Market Halts Winning Streak Amid Global Caution
India's stock market indices opened in the red on Tuesday, putting a pause on their impressive six-session rally. Investors adopted a wait-and-watch approach, turning cautious ahead of crucial economic data releases from the United States that are expected to provide clues on the Federal Reserve's interest rate trajectory for next month.
Key Indices See Early Decline
The benchmark Sensex dropped 292.95 points to settle at 84,658 in early trading. Similarly, the Nifty 50 index declined by 83.3 points, reaching 25,930.15. This pullback comes after a period of sustained gains where both benchmarks climbed approximately 2%, buoyed by a stable earnings season, robust domestic investments, and the resolution of the US government shutdown. Despite the recent rally, the indexes remain about 1.3% below their all-time highs recorded in September 2024.
The negative sentiment was partly influenced by weak global cues. US stock markets ended the previous session lower, and Asian markets witnessed a decline of 1.6%. This broad-based weakness stems from fading expectations for an interest rate cut by the US Federal Reserve in December, as traders await key data points, including the US jobs report for September.
Expert Technical Views on Nifty and Bank Nifty
Nifty 50 Faces Resistance
According to Riyank Arora, Technical Analyst at Mehta Equities Ltd, the Nifty 50 is trading with a mildly positive bias but continues to encounter significant resistance near the 26,100 level. The index finds strong support around 25,700. A decisive directional move is anticipated only if the Nifty 50 manages to close convincingly above 26,100. The Relative Strength Index (RSI) is hovering near 65, indicating steady momentum. However, an RSI breakout above the 75–77 zone is needed to trigger a strong trending move. Until such a breakout occurs, the market bias remains cautiously optimistic.
Bank Nifty Shows Bullish Strength
In contrast, the Bank Nifty index has delivered a clear all-time high breakout above the 58,600 mark, signaling robust underlying strength. The index now appears set for an upward extension towards 59,500 and 60,000 in the near term. On the downside, solid support is established at 58,400. Any dips towards this support level are likely to attract fresh buying interest. The overall structure for Bank Nifty remains strongly bullish, and traders are advised to maintain a positive outlook as long as the index sustains above the 58,400 support.
Short-Term Stock Picks from an Analyst
Riyank Arora has recommended three stocks for short-term trading opportunities:
Mangalore Refinery and Petrochemicals Ltd (MRPL)
The stock is showing steady upward momentum after holding firmly above its short-term moving averages. Having formed a constructive base near the ₹180 zone, it is now attempting to resume its uptrend. A push above ₹185 could trigger a move towards ₹190–195 levels. Traders can consider buying on minor dips, keeping a protective stop loss at ₹176.
Hero MotoCorp Ltd
Hero MotoCorp continues to display strength, maintaining a sequence of higher lows on its daily chart. Trading comfortably above key moving averages, the stock reflects strong buyer interest. A sustained move above ₹5,820 could accelerate momentum towards ₹5,950–6,050. Dips towards the ₹5,760–5,780 range may offer attractive entry points for traders.
Chennai Petroleum Corporation Ltd
Chennai Petro is trading near a breakout zone after forming a solid consolidation base. Strong volume activity suggests institutional accumulation. A move above ₹1,085 could fuel a sharp rally towards ₹1,120–1,150 levels. Traders can look to accumulate the stock in the ₹1,065–1,075 zone with a strict stop loss set at ₹1,045.
Disclaimer: The views and recommendations above are those of individual analysts and not of Mint. Investors are advised to consult certified experts before making any investment decisions.
