Get ready for another bear spell

Domestic markets are expected to open weakly as US Treasury yields jumped above the psychological 3% level. In the overloaded atmosphere, relentless crude oil prices add fuel to the fire.

Analysts say the lack of positive news has kept the market under bearish control. According to them, most of the negative news such as rising interest rates, geopolitical tensions, soaring inflation due to firm crude oil prices and general economic slowdown have already been factored in. But there is no positive news coming out of nowhere to stop the trend, they added.

REITs in sell mode

Prashanth Tapse, VP (Research), Mehta Equities Ltd, said FIIs are currently obsessed with negativity surrounding Dalal Street amid inflationary concerns amid WTI oil prices surging to $120.97 per barrel. Also, the bad news is that the Indian Rupee hit a fresh low against the US Dollar despite the RBI’s intervention in the FX market on Tuesday.

The derivatives data also indicates caution as FIIs again have more short positions open in the index futures segment, said Ruchit Jain, Lead Research, 5paisa.com.

SGX Nifty drops 80 points

SGX NIfty at 16,290 indicates, signals a further 80 bp opening lower spread for Nifty, as Nifty futures closed Wednesday at 16,365. At the start of Thursday’s deal, Asian stocks -Pacific were mixed, with Japanese, Korean and Chinese stocks little changed while Australian stocks lost more than 1%. Overnight, US stocks fell about 1%.

Nagaraj Shetti, Technical Research Analyst, HDFC Securities, said after RBI’s mid-quarter policy announcement around 10 a.m. Wednesday, the market showed a rapid intraday upside recovery, but momentum intraday failed to hold the highs. “The positive chart pattern like higher highs and higher lows are intact per the daily chart and the current weakness could be part of the new formation of higher bottoms. There is still no confirmation of a higher reversal. high in the market,” he added.

According to him, the current jerky movement could extend for one or two more sessions and the dips to watch around 16,200 levels. Strong aerial resistance is placed at 16,450-16,500 levels.

Published on

June 09, 2022

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