Nifty faces pressure at higher levels, end in red. Key levels to watch tomorrow

“Nifty ran into selling pressure at higher levels on a day when most other Asian indices were doing well. High crude oil prices, outcome of state elections and fears of rate hikes in India are raising concerns among FPIs who are choosing to take advantage of rallies to lighten their position,” said Deepak Jasani, Head of Retail Research, HDFC Securities.

Siddhartha Khemka, head of retail research at Motilal Oswal Financial Services, said: “(Indian) Markets are a bit cautious after the sharp rally (on Tuesday),” said , adding that concerns over higher inflation and interest rate hikes also lingered. There is continuous foreign institutional investor selling, which is keeping a check on the upside. We are seeing selling coming back on any sharp up move.”

The Nifty bank index fell 0.6%, while the public sector bank index dropped 1.2%. On the Sensex chart, NTPC, SBI, UltraTech Cement, ICICI Bank, Tata Steel, Bajaj Finserv and Bjaja Finance were among the major laggards, shedding as much as 1.63%.

In contrast, Bharti Airtel was the top performer, spurting 1.41 per cent, followed by HDFC, M&M, Dr Reddy’s, Kotak Bank and Nestle India.

“We continue to face selling pressure at higher levels. 17600 is the key resistance level and until we get past that on a closing basis, the trend will continue to remain sideways to bearish. We are in a trading zone and it is imperative we be patient as the stops are large and unforgiving,” said Manish Hathiramani, proprietary index trader and technical analyst, Deen Dayal Investments.

Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities, said” “Technically, the Nifty failed to sustain above the 50 day SMA which is broadly negative. For the bulls 17250 and 17200 would be the key support zones whereas 17500-17550 would act as an important hurdle for the traders.”

The broader markets were mixed today with BSE midcap index ending flat while the smallcap index rising 0.4%. Investors will also be eyeing the release of minutes of Fed’s January meeting. 

“The US Fed meeting minutes and lingering tension over the Russia-Ukraine crisis will remain on the radar. Besides, the scheduled weekly expiry would further add to the choppiness. We reiterate our cautious stance and suggest waiting for further clarity,” said Ajit Mishra, VP – Research, Religare Broking. (With Agency Inputs)