Ahead of Market: 10 things that will decide D-Street action on Tuesday
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Synopsis
Nifty continues its upward trajectory, displaying positive chart patterns with higher tops and bottoms. According to Nagaraj Shetti of HDFC Securities, the market's bullish momentum could propel it towards the 24,400 mark in the near term, with immediate support at 23,980 levels.
By Akash Podishetti, ETMarkets.com
Domestic markets sustained the upward momentum as the reduction in US PCE inflation raised hopes for a rate cut by the Fed in September.
"We anticipate this trend will persist in the near term due to expectations of a rebound in discretionary spending. Investors are now focusing on upcoming US job data and the Fed Chair's speech for further indication on interest rates," said Vinod Nair, Head of Research, Geojit Financial Services.
"The consistent buying interest on dips suggests bullish control, likely continuing the current tone. The renewed strength in midcap and smallcap segments adds further positivity. Traders should focus on selecting sectors/themes with rotational participation and consider adding positions during pauses or dips," said Ajit Mishra – SVP, Research, Religare Broking.
That said, here’s a look at what some key indicators are suggesting for Tuesday's action:
Banking stocks lifted the Dow, while semiconductor shares weighed on the Nasdaq on Monday as focus moves to labor market data due later in the week for cues on the Federal Reserve's monetary policy path.
At 10:16 a.m. ET, the Dow Jones Industrial Average was up 62.31 points, or 0.16%, at 39,181.17, the S&P 500 was down 9.52 points, or 0.17%, at 5,450.96, and the Nasdaq Composite was down 47.20 points, or 0.27%, at 17,685.40.
European stocks gained on Monday, with French shares leading the charge after the far-right National Rally (RN) party scored historic gains in the first round of parliamentary election, but by a smaller margin than what some polls had suggested.
France's blue-chip CAC 40 index jumped 1.6% to lead gains among regional markets, with the country's main lenders, including BNP Paribas, Societe Generale and Credit Agricole, advancing between 3.8% and 4.8%.
That helped the region-wide STOXX 600 index rise 0.6%, snapping four consecutive sessions of losses.
European stocks came off session highs on Monday after a survey showed manufacturing activity across the euro zone took a turn for the worse last month as demand fell at a much faster pace despite factories cutting their prices.
Momentum indicator Moving Average Convergence Divergence (MACD) showed bullish trade on the counters of Chalet Hotels, JBM Auto, KRBL, Indian Energy Exchange, Kfin Technologies and Minda Industries, among others.
The MACD is known for signaling trend reversals in traded securities or indices. When the MACD crosses above the signal line, it gives a bullish signal, indicating that the price of the security may see an upward movement and vice versa.
Vodafone Idea (Shares traded: 87.7 crore), YES Bank (Shares traded: 13.2 crore), Zomato (Shares traded: 5.3 crore), PNB (Shares traded: 4.4 crore), BEL (Shares traded: 3.9 crore), Motherson Sumi (Shares traded: 3.8 crore), and Alok Industries (Shares traded: 3.7 crore) were among the most traded stocks in the session on the NSE.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of the Economic Times)
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Here's how analysts the market pulse:"We anticipate this trend will persist in the near term due to expectations of a rebound in discretionary spending. Investors are now focusing on upcoming US job data and the Fed Chair's speech for further indication on interest rates," said Vinod Nair, Head of Research, Geojit Financial Services.
"The consistent buying interest on dips suggests bullish control, likely continuing the current tone. The renewed strength in midcap and smallcap segments adds further positivity. Traders should focus on selecting sectors/themes with rotational participation and consider adding positions during pauses or dips," said Ajit Mishra – SVP, Research, Religare Broking.
That said, here’s a look at what some key indicators are suggesting for Tuesday's action:
US market
Banking stocks lifted the Dow, while semiconductor shares weighed on the Nasdaq on Monday as focus moves to labor market data due later in the week for cues on the Federal Reserve's monetary policy path.ADVERTISEMENT
The S&P 500 banking index jumped 1.3% to its highest in more than a month, with shares of JP Morgan Chase touching an all-time high. Benchmark U.S. Treasury yields jumped to their highest in over two weeks.Stocks Recommendations
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The Nasdaq and the benchmark S&P 500 notched their third straight quarterly gains on Friday, with the tech-heavy index doing so for the first time in three years.
European shares
European stocks gained on Monday, with French shares leading the charge after the far-right National Rally (RN) party scored historic gains in the first round of parliamentary election, but by a smaller margin than what some polls had suggested.France's blue-chip CAC 40 index jumped 1.6% to lead gains among regional markets, with the country's main lenders, including BNP Paribas, Societe Generale and Credit Agricole, advancing between 3.8% and 4.8%.
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That helped the region-wide STOXX 600 index rise 0.6%, snapping four consecutive sessions of losses.
European stocks came off session highs on Monday after a survey showed manufacturing activity across the euro zone took a turn for the worse last month as demand fell at a much faster pace despite factories cutting their prices.
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Tech View
Positive chart patterns like higher tops and bottoms are intact. The underlying trend of Nifty remains positive. The market is racing towards the next upside target of 24,400 levels in the near term. Immediate support is placed at 23,980 levels, said Nagaraj Shetti of HDFC Securities.
Stocks showing bullish bias
Momentum indicator Moving Average Convergence Divergence (MACD) showed bullish trade on the counters of Chalet Hotels, JBM Auto, KRBL, Indian Energy Exchange, Kfin Technologies and Minda Industries, among others.The MACD is known for signaling trend reversals in traded securities or indices. When the MACD crosses above the signal line, it gives a bullish signal, indicating that the price of the security may see an upward movement and vice versa.
Stocks signaling weakness ahead
The MACD showed bearish signs on the counters of Godfrey Philips, Nippon Life AMC, Prince Pipes, Navin Fluorine, Lemon Tree Hotels, Apar Industries among others. Bearish crossover on the MACD on these counters indicated that they had just begun their downward journey.Most active stocks in value terms
Mazagon Dock Ship (Rs 2217 crore), GRSE (Rs 2,164 crore), CDSL (Rs 1,988 crore), HDFC Bank (Rs 1,800 crore), Vodafone Idea (Rs 1556 crore), Tata Motors (Rs 1,395 crore), and Maruti Suzuki (Rs 1,376 crore) were among the most active stocks on NSE in value terms. Higher activity on a counter in value terms can help identify the counters with highest trading turnovers in the day.
Most active stocks in volume terms
Vodafone Idea (Shares traded: 87.7 crore), YES Bank (Shares traded: 13.2 crore), Zomato (Shares traded: 5.3 crore), PNB (Shares traded: 4.4 crore), BEL (Shares traded: 3.9 crore), Motherson Sumi (Shares traded: 3.8 crore), and Alok Industries (Shares traded: 3.7 crore) were among the most traded stocks in the session on the NSE.Stocks showing buying interest
Shares of Chola Fin Holdings, GRSE, Mahanagar Gas, Home First Finance, Policybazaar, Castrol India, and JSW Infrastructure witnessed strong buying interest from market participants as they scaled their fresh 52-week highs, signaling bullish sentiment.Stocks seeing selling pressure
Shares of no companies hit their 52-week lows on Monday.Sentiment meter favoured bulls
Overall, market breadth favoured bulls as 2,630 stocks ended in the green, while 1,381 names settled in the red.(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of the Economic Times)
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