At 8:00am IST, the SGX Nifty Futures was trading at 11,181, compared with Nifty’s close of 11,153 Tuesday.
Market status: Downtrend
Current Correction Low: 11,085
Global stock markets: Dow 30, +0.5%; S&P, +1.1%; Nasdaq, +1.7%; Nikkei, -0.7%; Hang Seng, -0.3%; KOSPI, -0.7%
Yesterday, Nifty opened stronger but remained volatile throughout the day and extended its loss for the fourth consecutive session. Further, volume was higher than the previous session. Hence, yesterday's action qualified as a distribution day as the index fell more than 0.2% on a volume higher than the previous session. Also, we moved the market to a Downtrend as Nifty breached its 50-DMA, distribution day count elevated to seven, and many leading stocks failed to hold logical support levels. The broader market also continued to remain bearish. Nifty Midcap was down 1.5%, while Smallcap closed 1.8% lower.
Barring Nifty Pharma (+0.7%) and Nifty IT (+0.7%), all the sectoral indices closed in the red. Nifty Media lost more than 2.5%. Similarly, Nifty PSU bank, Pvt bank, Realty, and Auto were down 1–2%. Advance-decline ratio was skewed toward decliners. Out of 2,198 stocks traded, 413 advanced, 1,474 declined, and the rest remained unchanged.
Under this market conjuncture, investors should remain on the sidelines and refrain from taking any fresh exposure. Further, investors already with positions open should trim their market exposure, and raise cash if possible. They should wait for the market to show credible signs of recovery and meanwhile, can observe the stocks which are showing resilience under falling market scenarios. Looking forward, we will shift the market to a Rally Attempt if Nifty establishes a bottom and stays above yesterday's low (11,085) for three straight sessions. From there, we would prefer to see a follow-through day before shifting the market back to a Confirmed Uptrend. Should this occur, the focus will be on ideas that show the best relative strength with good accumulation.
Indian Oil’s board has approved the implementation of Petrochemical and Lube Integration Project at its Gujarat Refinery at an estimated cost of Rs 17,825 crore.
Shapoorji Pallonji Group which owns 18.27% stake in Tata Sons, said it is necessary to separate from the Tata Group due to the potential impact this continuing litigation could have on livelihoods and the economy. The two groups have around 70-years of relationship.
O’Neil Market Condition Report
For the 24 emerging markets tracked by our institutional research team, the market status breakdown is as follows: Confirmed Uptrend, 12%; Rally Attempt, 0%; Uptrend Under Pressure, 72%; Downtrend, 16%.
For the 24 developed markets tracked by our institutional research team, the market status breakdown is as follows: Confirmed Uptrend, 4%; Rally Attempt, 4%; Uptrend Under Pressure, 68%; Downtrend, 24%.