The Nifty 50 index fell 0.56% to 18,665.50 at the close, while the benchmark S&P BSE Sensex ended 0.41% to 62,979.37. For the week, the Nifty 50 and the Sensex lost 0.85% and 0.64%, respectively, both snapping a four-week winning streak. This was also their biggest weekly decline since late April.
Here's how analysts read the market pulse:
“Global central banks are currently focused on addressing inflation and have reiterated their commitment to reaching their target levels, as evidenced by the hawkish commentary from Powell and the unexpected rate hike by the Bank of England. The downward revision of earnings guidance by Accenture has raised concerns about potential earnings downgrades in the Indian IT sector, resulting in pressure on IT stocks. However, the domestic market is not expected to experience a significant correction due to favourable domestic economic indicators and correction in international commodities prices to sustain earnings growth on a QoQ basis,” Vinod Nair, Head of Research at Geojit Financial Services, said.
“The short-term trend of Nifty is about to reverse on the downside. Further decisive weakness from here could open intense selling pressure for the coming week. The next lower support is at 18370-weekly 10-period EMA. Any upside bounce could encounter a hurdle at 18760 levels,” Nagaraj Shetti, Technical Research Analyst, HDFC Securities, said.
That said, here’s a look at what some key indicators are suggesting for Monday’s action:US market
The S&P 500 and the Nasdaq closed higher on Thursday as U.S. Federal Reserve Chairman Jerome Powell continued to beat a hawkish drum and suggested the central bank has not reached the end of its tightening cycle, but provided reassurance that the Fed would proceed with caution.
The Dow Jones Industrial Average fell 4.81 points, or 0.01%, to 33,946.71, the S&P 500 gained 16.2 points, or 0.37%, to 4,381.89 and the Nasdaq Composite added 128.41 points, or 0.95%, to 13,630.61.
European shares
European shares dipped on Friday at the end of a central bank policy-packed week that reinforced views that interest rates could stay higher for longer, while shares of Siemens Energy plunged as it withdrew its annual profit outlook. The STOXX 600 index closed 0.3% lower after data showed euro zone business growth stalled this month as the downturn in manufacturing deepened.
The index has lost 2.9% for the week, posting its worst weekly performance in over three months, as investors digested more interest rate hikes from major central banks including the Bank of England, Norges Bank, and Swiss National Bank, and the spectre of elevated inflation for longer.
Tech View: Bearish Dark Cloud Cover pattern
Nifty formed a bearish Dark Cloud Cover pattern on weekly charts after falling 0.85% over the week. A quick recovery and move beyond the all-time high may be difficult in the near term. Nifty could find support in the 18459-18555 band, while 18795 could offer resistance on upmove in the near term.
Stocks showing bullish bias
Momentum indicator Moving Average Convergence Divergence (MACD) showed bullish trade on the counters of Natco Pharma, DCM Shriram, Coffee Day Enterprises, and ICICI Securities, among others.
The MACD is known for signalling 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 IDFC First Bank, BHEL, Tata Steel, Samvardhana Motherson, and BEL, among others.
A bearish crossover on the MACD on these counters indicated that they had just begun their downward journey.
Most active stocks in value terms
Adani Enterprises (Rs 3416 crore), HDFC Bank (Rs 1760 crore), HAL (Rs 1599 crore), ICICI Bank (Rs 2539 crore), Adani Ports and SEZ (Rs 1104 crore) and Infosys (Rs 991 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 the highest trading turnovers in the day.
Most active stocks in volume terms
Suzlon Energy (Shares traded: 13.31 crore), Vodafone Idea (Shares traded: 12.19 crore), Reliance Power (Shares traded: 8.02 crore), IDFC First Bank (Shares traded: 5.68 crore), and Zomato (Shares traded: 5.18 crore) among the most traded stocks in the session on NSE.
Stocks showing buying interest
Shares of Aurobindo Pharma, Trent, AstraZeneca, Policy Bazaar, and Interglobe Aviation, among others, witnessed strong buying interest from market participants as they scaled their fresh 52-week highs, signalling bullish sentiment.
Stocks seeing selling pressure
Shares of AG Universal, City Union Bank, Adani Gas, and Accuracy Shipping, among others, hit their 52-week lows, signaling bearish sentiment on the counters.
Sentiment meter favours bears
Overall, market breadth favoured bears as 2,291 stocks ended in the red, while 1,174 names settled in the green.
(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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