The Indian equity market is expected to open lower on Friday amid weak global cues and lack of positive triggers.
SGX Nifty at around 16,200, down over 200 points from Thursday’s Nifty Futures close indicates a gap down opening for the market.
Further, global equities are trading lower as inflation concerns and consequent rate hikes by central banks globally weigh on investor sentiments.
The US stocks edged lower ahead of May 2022’s CPI numbers to be released later today. The markets in Europe weakened as well.
The European Central Bank on Thursday affirmed its intention to hike key interest rates by 25 bps at its policy meeting next month, downgrading its growth forecasts.
According to analysts, volatility is likely to remain as rising oil prices, prolonged geopolitical tensions and sustained foreign outflow continue to impact investor sentiments.
Investors will be keenly watching the outcome of the Federal Reserve policy-setting meeting next week.
According to Ajit Mishra, VP - Research, Religare Broking Ltd, “Markets have been witnessing volatile swings in a broader range and most sectors are trading in tandem with the trend.”
“Among sectors, auto and oil&gas looks strong to us while metals may continue to trade subdued,” added Mishra.
Technicals
According to Ruchit Jain, Lead Research, 5paisa.com, “Overall, we can see ‘Triangle’ developing on the Nifty charts, a sign of consolidation, and only on a breakout from this would see the next directional move in the market.”
“The extreme ends of this pattern are around 16,700 and 16,100. The intraday supports are placed around 16,405 and 16,320 while resistances are seen around 16,570 and 16,655,” added Jain.
As per Prashanth Tapse, Vice President (Research), Mehta Equities Ltd, “Technically speaking, the downside risk for Nifty is still seen at 16,121, and honestly speaking, the perma-bulls will have to really find reasons to take the index above its biggest hurdles at 16,795 mark.
”FIIs on selling spree
Foreign institutional investors (FIIs) continued their selling spree, having net sold ₹1,512.64 crore worth of shares on June 9, while domestic institutional investors (DIIs) remained net buyers, purchasing shares worth ₹1,624.90 crore, as per NSE provisional data.