Trends on SGX Nifty indicate a gap-up opening for the Indian stock indices. Indian markets could open sharply higher in line with positive Asian markets today and higher US markets on Wednesday, said Deepak Jasani, Head-Retail Research, HDFC Securities.
Prashanth Tapse, Vice President (Research), Mehta Equities Ltd said, Nifty set to start the day on solid footing as world equity markets have posted robust gains on the back of triple boost such as US Fed's little hawkish stance, Ukraine-Russia ceasefire deal reports, and China hinting at a economic stimulus. The Nifty options data for March series suggests the benchmark index is likely to be in a trading range of 16,000-18,000 zone. Maximum Call OI is at 18,000 followed by 17,000 strike price. So, the 17,000 mark will be Nifty’s crucial resistance zone.
Nifty recorded the best day in a week on March 16, as global markets bounced up on fears subsiding and new hopes of stimulus in China. A last hour rally resulted in Nifty closing 1.87 percent or 312.3 points higher at 16975.4.
Nifty continued its upmove and closed short of the downgap of 17,027. Advance decline ratio was sharply positive. Lower than normal volumes suggested a low level of selling activity from FPIs. Nifty could now continue its upmove and face resistance from the 17,092-17,220 band on the upside. On downmoves, 16,757-16,888 band could provide support, Jasani added.
Asian stocks soar
Asian stocks jumped Thursday as Chinese technology shares soared again and traders digested the Federal Reserve’s view that the US economy is strong enough to weather the campaign against high inflation now underway. US.-listed Chinese stocks soared on Wednesday following the report, which said regulators from both countries are working toward a cooperation plan on U.S.-listed Chinese stocks.
US stocks rally
USstocks rallied for a second day in volatile trade Wednesday, with the Dow swinging nearly 700 points from session lows, after the Federal Reserve pulled the trigger on its first interest rate hike since 2018, while indicating more rate increases and balance sheet reduction will follow.
The S&P 500 closed up more than 2 percent while the Nasdaq rallied almost 4 percetn on Wednesday as investors shrugged off initial jitters following the US Federal Reserve's interest rate increase and its signal that more hikes would be needed to fight inflation, ending the pandemic-era's easy monetary policy, Reuters said.
The Dow Jones Industrial Average rose 518.76 points, or 1.55 percent, to 34,063.1, the S&P 500 gained 95.41 points, or 2.24 percent to 4,357.86 and the Nasdaq Composite added 487.93 points, or 3.77 percent to 13,436.55.
US Fed hikes interest rate
The Federal Reserve on Wednesday raised its benchmark interest rate by a quarter percentage point and laid out plans for a more aggressive strategy of “ongoing increases” in the months ahead to combat high inflation.
The Fed now sees its policy rate hitting 1.9 percent by the end of this year, jumping to 2.8 percent in 2023 and staying at that level in 2024. Powell said on Wednesday that balance sheet reduction could begin in May. The Fed projected inflation would average 4.3 percent at the end of 2022, up from its prior 2.6percent forecast. The last time the central bank expected inflation to top 3 percent was in 2007.
Yield on Treasury notes up
The yield on the US 10-year Treasury note rose 2.5 basis points to 2.185 percent, after the Fed decision. In economic reports, sales at U.S. retailers slowed sharply in February, rising 0.3 percent, and Americans probably bought fewer goods like groceries, consumer electronics and furniture after factoring in high inflation.
Stock under F&O ban
Balrampur Chini Mills is under the F&O ban for March 17.
(With inputs from Reuters)
