Domestic markets are likely to open on a flat note on Wednesday, tracking global cues.
However, with foreign portfolio investors’ interest continuing and lack of any negative global cues, Indian equities are likely to maintain the momentum, said analysts.
Analysts further said the market to remain lacklustre in early part of the session.
SGX Nifty at 18,740 against Nifty futures’ Tuesday close of 18,733.60 signals soft opening for domestic markets. According to analysts, while benchmarks move in a narrow range, select stocks from mid-cap and small-cap sector will be in focus.
India VIX concluded the session at 13.59, indicating the market appears to be stable, said domestic brokerage Choice International.
According to open interest data, the highest OI was observed on the call side at 18,700, followed by 18,800 strike prices, while the highest OI was observed on the put side at 18,500, followed by 18300 strike prices, it said.
“Participation from the broader market further strengthens the overall market. However, due to global concerns, sporadic volatility cannot be ruled out,” it added.
Except for Japan markets, equities across Asia-Pacific region are up marginally in early deal on Wednesday. The US stocks closed on a weak note overnight.
According to Edward Moya, Senior Market Analyst, The Americas OANDA, investors remain fixated with anything that involves inflation and most of those headlines are leading many to believe the Fed hawks might be proven right next quarter.
Ruchit Jain, Lead Research ,5paisa.com, said: “After testing the new all-time high in Monday’s session, the market participants continued their cheerful mood as the index shrugged off the negative global cues and continued its northwards momentum.”
However, the index traded within a narrow range amidst stock specific action. Despite the positive trend, the momentum readings on the hourly time frame of Nifty and on the daily chart of Bank Nifty are in an overbought zone and such overbought set ups need to cool-off before gaining momentum again, he cautioned.