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Updated on: Wednesday, July 28, 2021, 09:16 AM IST

Trends on SGX Nifty indicate a cautious opening for stock markets

The Nifty is expected to open around 15,780 , up by about 45 points. | File

The Nifty is expected to open around 15,780 , up by about 45 points. | File

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Trends on SGX Nifty indicate a cautious opening for the index in India with a 18 points gain. The Nifty futures were trading at 15,760 on the Singaporean Exchange.

US stocks fell from record highs on Tuesday while real US bond yields hit all-time lows, as a sell-off in Chinese shares, economic growth concerns and the Federal Reserve's policy meeting put investors on guard and drove profit taking.

The Dow Jones Industrial Average ended down 0.2 percent at 35,059 points, and the S&P 500 shed 0.5 percent to end at 4,401 points. The Nasdaq Composite slid 1.2 percent to 14,660 points, its biggest one-day drop since May 12.

The markets could open flat to mildly higher, despite mixed Asian markets today and negative US markets on Tuesday, said Deepak Jasani, Head of Retail Research, HDFC Securities.

Gaurav Udani, CEO & Founder, ThincRedBlu Securities, said, "The Nifty is expected to open around 15,780 , up by about 45 points. On Tuesday, the Nifty made a bearish bar and was down by 86 points. Weakness on Nifty may continue today--15,700 and 15,580 will act as supports and 15,880-15,920 range will act as strong resistance."

Indian benchmark equity indices once again failed to hold on to gains on July 27 as Asian markets came under pressure after China continued to crackdown on its internet businesses. Q1FY22 numbers from Indian corporates failed to excite investors. At close Nifty was down 0.49% to 15746.5. Smallcap indices ended better than the Nifty.

Jay Thakkar, VP and Head of Equity Research, Marwadi Shares and Finance Ltd, said, the Nifty closed around 15,700 levels in yesterdays trading session which is good support going forward. 15,700 to 15,600 is a very good support range, hence we can assume that nifty can bounce back, however, there is a resistance on the upside at 15,850-15,900 range. Coming to this expiry week, Nifty has further narrowed its range 15,900 to 15,600 range and unless a breakout happens expect expiry around these levels.

"International markets have gone sideways after a zone of 4-5 sessions, from here on all eyes are on the dollar index. We can expect this range to continue in this expiry week as well. The highest open interest is seen at 15,700 put options which is showing a good built up. At higher levels, good amount of call writing is done which will continue to put pressure on a bounce," Thakkar said.

Nifty has formed a bearish Engulfing Top like pattern. It has repeatedly failed to cross the 15962 level. With the US Fed meet and F&O expiry over the next two days, we could see heightened volatility in the markets. 15632-15824 could be the band for the Nifty over the next 1-2 sessions.

US stocks closed lower Tuesday, after a five day rally to record highs for the main indexes, ahead of quarterly results from some of the most prominent names in the technology sector and as a Chinese regulatory crackdown dampened the investing mood on Wall Street. US stocks slumped, led by technology stocks, as investors worried about a selloff in Hong Kong’s Hang Seng Index, which has put pressure on risk assets around the globe.

The developments in Asia come as investors are also waiting for economic reports this week, including second quarter GDP, and a policy update from the Federal Reserve on Wednesday.

The Conference Board’s closely followed index of US consumer confidence edged up to 129.1 this month from a revised 128.9 in June, hitting a 16-month high.

The International Monetary Fund, on July 27, cut India's gross domestic product (GDP) growth forecast to 9.5 percent for fiscal year 2021-22, from the previous forecast of 12.5 percent, citing the hit on economic activity and demand due to the deadly 'second wave' of the COVID-19 pandemic. For fiscal year 2022-23, however, IMF expects economic growth of 8.5 per cent, larger than the 6.9 per cent it had projected in April.

Asian shares trade low

Shares in Asia-Pacific were lower in Wednesday morning trade at 7 month lows, as a rout in China spurs caution and U.S. megacap technology earnings receive a mixed response. Traders were reluctant to place large bets ahead of the outcome of the US Federal Reserve meeting.

Brent Futures' first decline in 6 days

Brent futures slipped 2 cents to settle at $74.48 a barrel, while US West Texas Intermediate (WTI) crude fell 26 cents, or 0.4 percent to settle at $71.65. That was the first decline for Brent in six days.

Quarterly results

Following companies will release their quarterly results today: Maruti Suzuki India, Nestle India, ABB India, Astec Lifesciences, Birasoft, Central Bank of India, Century Textiles & Industries, Coforge, Dhanlaxmi Bank, Embassy Office Parks REIT, Gateway Distriparks, Geojit Financial Services, Greenpanel Industries, Grindwell Norton, Happiest Minds Technologies, Heritage Foods, HSIL, ICRA< IDBI Bank, Intellect Design Arena, JM Financial, Mahindra Lifespace Developers, Mahanagar Gas, Mold-Tek Packaging, Pfizer, Radico Khaitan, Ramco Systems, Route Mobile, RPG Life Sciences, Sagar Cements, SRF, Tata Coffee, TCI Express, TeamLease Services, United Breweries,, UTI Asset Management Company and Welspun India.

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Published on: Wednesday, July 28, 2021, 09:02 AM IST
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