Nifty, Sensex end deep in red amid weak global cues; markets to remain volatile in near-term

Domestic equity markets ended in red after a two-day rally, as lack of triggers erased momentum. The BSE Sensex index slumped 709 points, or 1.35 per cent, to end at 51,823 with 28 of the 30 index constituents settling in the red. The Nifty 50 closed at 15,413, down 226 points or 1.44 per cent. Sectorally, all the key indices closed in the red with the Nifty Metal index down 5 per cent, and Nifty Oil & Gas index 2 per cent. In the broader markets, the Nifty MidCap100 and SmallCap100 indices fell up to 1.6 per cent. Markets are likely to highly volatile in near-term. The Nifty may find support around 15200 levels while on the upside 15600 may act as an immediate hurdle, according to analysts.

Ajit Mishra, VP – Research, Religare Broking

“After a breather, bears took tight control over markets as it ended with sharp losses. The benchmark started on a muted note tracking weak Asian markets and further negative bias continued throughout the day as selling pressure widened in metals, media and energy. Consequently, the Nifty ended lower by 1.44% at 15,413.3 levels. The broader markets, midcap and small-cap ended in-line with the benchmark. All the sectoral indices ended in the red.”

“On Thursday i.e.23th June, markets will first react to the Fed chairman speech scheduled tonight. Besides, progress on monsoon, crude price and currency movement will be key monitorable. We reiterate our cautious stance on the markets and expect volatility to remain high in the near term. Meanwhile, traders are advised to keep a hedge position while investors should focus on stock selection.”

Om Mehra, Research Associate, Choice Broking

“The Indian markets depleted on Wednesday snapping two days gains, tracking weakness in global cues. Technically, Nifty has formed a bearish candlestick on the daily chart. From the hourly chart, Nifty 15550 levels have minor resistance for next trading day. However view negated if closing and sustaining above those levels. Indicators such as ATR and ADX remained on the weaker side on the daily chart as well. The Nifty may find support around 15200 levels while on the upside 15600 may act as an immediate hurdle. On the other hand, Bank nifty has support at 32200 levels while resistance at 33500 levels. Overall, Index remains on weaker side, sell on rise and working with option strategy would be suggested to counter volatility.”

Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities

“Markets once again went into a plunge mode as panic-stricken investors taking cues from an early slump in European indices and weakness in other Asian gauges dumped equities, especially metal, power & realty stocks. The market is currently in a very fragile mode as any signs of negativeness is prompting traders to exit stocks at will. Technically, the Nifty has also formed a bearish candle which suggests further weakness from the current levels. On intraday charts, the index has formed non directional formation while the texture of the chart is suggesting that a range bound activity is likely to continue in the near future. For traders, 15500 would act as an immediate resistance level, above which it could rally till 15600-15650. On the flip side, 15350 could be the key support level to watch out for. Below the same, the index could slip till 15250-15200.”

Deepak Jasani, Head of Retail Research, HDFC Securities

“Asian shares were mostly lower Wednesday as markets shrugged off a rally in the US and awaited congressional testimony by Fed Chair Jerome Powell. European stocks hit fresh one-year lows on Wednesday as a fall in oil and metal prices hurt commodity-related stocks. Nifty on June 22 could build on to the gains of Tuesday and gave up almost the entire gains made on that day. Markets have fallen sharply on below normal volumes, suggesting lack of adequate buying to offset the selling pressure. Now Nifty has support at 15293-15350 band while on upmoves, it could face resistance from 15565 and later 15670.”

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