Informist, Tuesday, Jan 30, 2024
By Padmini Dhruvaraj
MUMBAI – Domestic benchmark indices are expected to remain rangebound with a positive bias until the announcement of the Interim Budget for 2024-25 (Apr-Mar), due on Thursday, with the Nifty 50 index expected to find support at 21300-21400 points and face resistance at 21600-21750 points. Additionally, analysts said stock-specific movement will continue due to the ongoing corporate earnings season for Oct-Dec.
On the global markets front, all eyes will be on the US Federal Reserve’s policy meeting that will commence today. Though investors expect the Fed to maintain status quo in rates, the direction concerning rate cuts will hold importance. “Overall, we expect the market to remain rangebound till the two large events (the US Fed meeting and India’s Interim Budget) unfold,” Siddhartha Khemka, head of retail research at Motilal Oswal Financial Services, said in a note.
“With just one day left for the Budget, investors want to play it safe, although there would not be any big-bang announcement by the government in this Budget,” Prashanth Tapse, senior vice president of research at Mehta Equities, said in a note.
On similar lines, Sheersham Gupta, director and senior technical analyst at Rupeezy, said “This is a Budget-induced volatility that we are witnessing in the markets, leading to profit-booking across the majority of sectors. This is substantiated by the India VIX achieving its highest closing for the current financial year.”
Today, the Nifty 50 ended 1% lower at 21522.10 points and the India VIX rose 2.7% to close at 16.10, the highest since Mar 16, 2023.
The Nifty 50 continues to face selling pressure over the 21800 level, which was observed in today’s session, Avdhut Bagkar, technical and derivatives analyst at StoxBox, said. Furthermore, the price action highlighted weakness post slipping beneath the 21605 level, translating that as an immediate obstacle for the index, he added.
The Nifty Auto sectoral index hit an all-time high of 19123.70 points today and analysts said the index may continue to touch new highs in the next few sessions. Amongst other sectors, analysts are bullish on pharma, consumer durables, and fast-moving consumer goods as they might attract some defensive buying amid volatility in the overall market.
“The recent price action shows indecisiveness amongst the participants despite the favourable global cues, and we feel the prevailing tone may continue. Meanwhile, traders should focus on stock selection and maintain positions on both sides,” Ajit Mishra, senior vice president of technical research at Religare Broking said in a note.
Further, investors will assess the December quarter earnings of Dr Reddy’s Laboratories, released after market hours today, along with those of Larsen & Toubro which are also due today.
Additionally, shares of Maruti Suzuki India and Sun Pharmaceutical Industries will also be in focus as these companies will detail their quarterly results on Wednesday. Shares of Metro Brands and Poonawalla Fincorp may fall on Wednesday as the stock will trade ex-dividend. End
Edited by Tanima Banerjee
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