The domestic markets are likely to open on a flat note with negative bias on Wednesday. Amid a lack of triggers, analysts expect stock and sector specific action to continue. Though global sentiment is negative, the return of foreign portfolio investors as buyers, especially after the Fed Chair’s rate cut speech, will support the market, they added.
Nifty futures at Gift City is ruling around 25,000, signalling a weak opening.
Siddhartha Khemka, Head - Retail Research, Motilal Oswal Financial Services Ltd, said: Nifty continued to gain strength for the ninth day in a row, but missed achieving all-time high levels by just 5 points. “Majority of the sectors ended in the green, with buying seen in financials and pharma. Markets are optimistic about the US Fed policy rate cut following Jerome Powell’s supportive comments and the Federal Reserve’s confidence in achieving its 2% inflation target. Further, buying by FIIs over the last three days added to the sentiment. We expect this up-move to continue with Nifty likely headed towards new highs in the near term, supported by the broader market and stock specific action.”
FPIs bought shares worth about ₹5,000 crore in the last four days.
Meanwhile, equities across the Asia-Pacific region opened lower following a sluggish day on Wall Street.
Trading in F&O markets also give a positive signal, said analysts. The rollover of derivative contracts to the September series is quite healthy and higher than in previous months, signalling positive sentiment.
Dhupesh Dhameja, Technical Analyst, SAMCO Securities, said the options market reflects a bullish sentiment, with more Puts being written than Calls as Nifty trades in higher highs and lows structure. Significant open interest at the 25,000 Call (86.11 lakh contracts) and the 25,000 Put (93.78 lakh contracts) indicates a fierce battle between buyers and sellers, with notable activity around the 24,800-24,900 Puts and 25,100-25,200 Calls, he further said. “The Put-Call Ratio (PCR) has decreased slightly from 1.22 on Monday to 1.11, underscoring a strong bullish structure as Put writers dominate. The Max Pain Point, concentrated at 24,950, marks a critical level that could influence the index’s movement,” he added.