Stock markets may begin trading in red; 5 things to know before today’s opening bell

Stock markets reached fresh all-time highs on Tuesday but failed to sustain at those levels. S&P BSE Sensex ended flat with a negative bias at 52,104 points while the 50-stock NSE Nifty closed the day at 15,313. Although the benchmarks slipped, broader markets were seen inching higher. Nifty Junior jumped 0.40%, followed by smallcap and midcap indices. Among sectoral indices, only Nifty Metal, Pharma, Realty, and PSU Bank index closed in the green. The fear gauge of domestic equity markets, India VIX, ended over 1% higher.

Technical take: Caution is the word as equity markets refuse to budge. “We must be optimistic but cautiously. According to the Japanese candlestick theory, there is continuity in the market today. The market has fallen to the lowest level of the previous day but due to the unusual strength in the market, it has turned into a buying opportunity for short-term traders,” said Shrikant Chouhan, Executive Vice President, Equity Technical Research at Kotak Securities.

Support and resistance: In the coming session, 15,250 should act as support for Nifty, followed by 15,100, according to Rohit Singre, Senior Technical Analyst at LKP Securities. He added that holding above the support levels could propel the index higher towards 15,400-15,500 zone. Meanwhile, Chouhan of Kotak Securities believes Sensex, Nifty could touch 15400/52400 level and on further bullishness could scale 15450/52500 levels. “On the downside, the 15240/51850 level would provide major support and dismissing it would lead to short-term weakness in the market,” he added.

FII and DII activity: Foreign Institutional Investors (FII) continued to remain, net buyers of domestic stocks for the second day running. FIIs pumped in Rs 1,144 crore into the markets on Tuesday. Domestic Institutional Investors (DII) were once again pulling money away from stock markets, taking away Rs 1,559 crore. 

Global watch: After a day’s break in trading, Wall Street resumed only to end mixed. NASDAQ and S&P 500 closed in the red while Dow Jones ended with gains. Hang Seng was trading lower during the early hours of trade, followed by Nikkei 225, TOPIX, KOSPI, KOSDAQ.

IPO update: Nureca’s public issue subscription closes today. So far the IPO has been subscribed 14.77 times with retail investors subscribing the issue 80.33 times. NIIs have also oversubscribed their portion, however, QIBs remain non-existent so far. RailTel the second IPO coming from the Ministry of Railway so far in 2021 opened for bidding yesterday and was oversubscribed. RailTel’s IPO has been subscribed 2.63 times so far with retail investors bidding for 4.99 times their quota.