GIFT Nifty futures hint at muted start; markets to trade cautiously
Markets likely to open muted as GIFT Nifty signals a cautious start. Key resistance levels remain intact; pharma and healthcare sectors favoured for longs amid mixed global cues and reduced volatility.
The markets are likely to open on a subdued note on Tuesday, with GIFT Nifty futures trading 11 points lower at 23,760, suggesting a flat-to-negative opening for the benchmark indices. Analysts advise maintaining a cautious stance as key resistance levels remain unchallenged.
Key levels to watch
The levels of 23,850–23,870 pose a significant hurdle, followed by the bearish gap of 24,000–24,150. Any bounce-back below these levels is an opportunity to trim long positions. On the downside, 23,600–23,500 may act as immediate support, while a breach could trigger further corrections toward 23,350.
Market sentiment
- India VIX: The fear gauge fell by 10.3% to 13.52, indicating reduced volatility.
- FII/DII activity: Foreign portfolio investors sold shares worth Rs 168 crore, while domestic institutional investors net bought Rs 2,228 crore.
Global cues
- US markets: Wall Street saw gains, with the Dow, S&P 500, and Nasdaq rising by 0.16 per cent, 0.73 per cent, and 0.98 per cent, respectively.
- Asian markets: Mixed trends were observed, with Hang Seng futures up 0.1 per cent and Japan’s Nikkei 225 futures down 0.1 per cent.
- Gold & dollar: Gold prices held steady, while the dollar remained firm as investors expect interest rates to stay elevated longer.
Stocks in focus
- F&O ban: Granules, Manappuram, Hindustan Copper, Bandhan Bank, and RBL Bank are under the F&O ban due to high position limits.
- Sectors to watch: Analysts favour pharma and healthcare for long positions while expecting mixed trends in other sectors.
Rupee watch
The rupee depreciated by 7 paise to settle at 85.11 against the US dollar on Monday, driven by a strong dollar index following the Fed’s hawkish stance.
Expert view
Ajit Mishra, SVP of Research at Religare Broking, advises traders to maintain a negative bias on indices until signs of a rebound emerge, highlighting selective opportunities in individual stocks.
Traders should stay vigilant amid the ongoing cautious sentiment and focus on sectoral opportunities.
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