Trade setup for Sept 16, 2022: Things to know before stock market’s Opening Bell

Market


Trade setup for Friday: On account of speculations about a possible 100 basis point US Fed interest rate hike next week, Indian stock market finished on the lower side on second successive session on Thursday. Nifty 50 index lost 126 points and closed at 17,877 while BSE Sensex shed 412 points and closed at 59,934 levels. Nifty Bank index finished 196 points lower at 41,209 levels. Mid-cap index ended 0.31 per cent in the positive although the advance decline ratio was negative at 0.76:1.

As Fitch Ratings has slashed its growth forecast for India for the current fiscal year, here we list out key things that you should know before stock market’s opening bell today:

Global markets cues

On Wall Street, key benchmark indices finished lower on rising global recession fears and FedEx Corporation’s warning on weak earnings. Dow Jones lost 0.56 per cent, Nasdaq nosedived 1.43 per cent, S&P 500 dipped 1.13 per cent whereas Small Cap 2000 went off 0.66 per cent on Thursday. Other global stock markets were mixed on Thursday as the likelihood of a further jump in global borrowing costs, including a possible 100 basis point U.S. rate hike next week, kept the bears on the prowl.

Fitch Ratings forecast for Indian GDP

Fitch Ratings has slashed its growth forecast for India for the current fiscal year to 7 per cent from the previous estimate of 7.8 percent. The ratings agency also cut its GDP growth forecast for the next fiscal year to 6.7 per cent from the earlier estimate of 7.4 per cent.

Fitch now expects world GDP to grow by 2.4 per cent in 2022 and by just 1.7 per cent in 2023. The eurozone and UK are now expected to enter recession later this year and Fitch forecasts that the US will suffer a mild recession in mid-2023.

Nifty technical outlook

“Nifty corrected once again from above 18,000 level and underperformed the other markets for a change. Broad markets continues to lag while large-caps seemed to be under mild selling pressure. 18,096 to 17,771 could be the band for the Nifty in the near term,” said Head of Retail Research at HDFC Securities.

“Nifty 50 index recovered smartly from the lows on Wednesday but there was no follow up buying seen in today’s session. If we look at the daily chart, the Nifty seems to be trading within a ‘Rising Wedge’ pattern on the daily chart. The support end of the pattern is placed around 17,770 and the ‘20 DEMA’ support is around 17,700. So these are the important support levels and if these get breached, then the implication of the breakdown from the above mentioned pattern will be bearish. However, till the index trades above the mentioned support, there’s nothing much to worry about. The momentum readings on the daily charts are still positive but have given a negative crossover on the hourly chart. Thus, we would keep a close watch to see if the readings on the hourly chart give positive crossover first, which would open up more room on the upside. However, if the index breaches the above supports and the daily readings too give a negative crossover then would be time to turn cautious. On the flipside, the immediate resistance for the Nifty is seen around 18100 followed by 18200-18250 range,” said Ruchit Jain, Lead Research at 5paisa.com

Nifty Bank technical outlook

“Immediate support for Bank Nifty is placed around 41,000 to 41,100 levels whereas it is facing hurdle at 42,000 to 42,100 levels. This means, broader range of Nifty Bank for intraday traders lies in between 41,000 to 42,100 levels,” said Mehul Kothari, AVP — Technical Research at Anand Rathi.

Nifty Call Option data

As per data shown by nseindia.com at 3.30 pm on 15 September, major total Call open interest was seen at 18000, 18100 and 18200 strikes with total open interest of 75385, 58314 and 57301 contracts respectively. Major Call open interest addition was seen at 18000 and 18100 strikes which added 49786 and 35554 contracts respectively.

Nifty Put Option data

Major total Put open interest was seen at 17900, 17800 and 17600 strikes with total open interest of 33490, 38948 and 37617 contracts respectively. Major Put open interest addition was seen at 17800 and 17600 strikes which added 17238 and 27229 contracts respectively.

Nifty Bank Call Option data

Major total Call open interest was seen at 41400 and 41500 strikes with total open interest of 18669 and 57372 contracts respectively. Major Call open interest addition was seen at 41400 and 41500 strikes which added 10432 and 33304 contracts respectively.

Nifty Bank Put Option data

Major total Put open interest was seen at 41000 and 40500 strikes with total open interest of 27628 and 20714 contracts respectively. Major Put open interest addition was seen at 41000 strike which added 14408 contracts.

FII DII data

Foreign institutional investors (FIIs) have net sold 1270.68 crore worth of shares, whereas domestic institutional investors (DIIs) have net sold 928.86 crore worth of shares on September 15, as per the data available on the NSE.

NSE F&O ban stock list today

The National Stock Exchange (NSE) has added RBL Bank and Indiabulls Housing Finance stocks under its F&O ban list for trade date 16th September 2022. Securities in the ban period under the F&O segment include companies in which the security has crossed 95 per cent of the market-wide position limit.

US bond yield

US 10 year bond yield is down by 0.46 per cent to 3.443 whereas US 30 year bond yield is down by 0.50 per cent to 3.463.

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