Despite gloom around Gift Nifty indicates a flat opening for Nifty. At 730 am IST, Nifty futures at Gift City is ruling at 19,730, which is in between Nifty September contracts value of 19,677.05 and October futures value of 19,793.55.
Overnight, US stocks plunged over one per cent, amid prolonged rate hike fears. Equities across Asia-Pacific region are mixed - Japan, Korea and Australian markets down even as Chinese and Taiwan markets eke out marginal gains.
Only thing that is certain is volatility in these days, said analysts. According to them, domestic markets lack any big trigger while global sentiment is too weak. The monthly settlement of September contracts at the NSE derivative segment on Thursday will add to volatility further he added.
Global stocks are under pressure, as mounting fears of rates staying elevated for longer sent jitters through risk assets globally and pushed the dollar to a 10-month high, said Deepak Jasani, Head of Retail Research, HDFC Securities. In Asia, investors continue to consider the state of the property sector in China after it emerged that property group Evergrande said it was struggling to organise a process to restructure its debt, prompting weakness in basic resources, he added.
Analysts said that FPIs are indulging in sector rotation whereby booking profits in select sectors and at the same time buying value picks.
“Negative developments in Asian markets and foreign investors withdrawing funds from India contributed to the Rupee’s decline. The US Dollar gained significant strength as the Federal Reserve, akin to the central bank of the United States, indicated its intention to raise interest rates, bolstering the Dollar’s value,” said Ameya Ranadive, Equity Research Analyst, Choice Broking.
Volatility index climbed to 11.175, signalling uneasiness of market participants.
“Analysing the Open Interest (OI) Data, the call side showed the highest OI at 19,800, followed by the 20,000 strike prices. On the put side, the highest OI was observed at the 19,600 strike price. For Bank Nifty, the support levels are at 44,400 to 44,200, while resistance is positioned at 45,000 to 45,100 levels.\,”
Rupak De, Senior Technical analyst at LKP Securities, said: “Nifty remained largely range-bound throughout the day as traders appeared uncertain. However, the short-term sentiment remains bearish as Nifty closed below the 21EMA. Looking ahead, the trend is expected to stay bearish as long as Nifty remains below the 19750 level. A support level is established at 19600, below which the index may decline further towards 19250.”