Ahead of Market: 10 Things That Will Determine Stock Market Action on Monday

The Indian market recovered from steep early declines but still closed lower on Friday, marking a third straight session of losses for the Sensex and Nifty, as investors held on to gains after October’s strong rally. The sell-off, driven by foreign outflows and a cautious global environment, was tempered by optimism over corporate earnings and potential progress in India-US trade talks.The S&P BSE Sensex fell 0.1% to 83,216.28, recovering from a fall of over 600 points earlier in the session, while the NSE Nifty 50 fell 0.07% to 25,492.30 after recovering from losses of almost 0.7% earlier in the day.

This is how analysts read the market pulse:

Domestic equities recovered from early losses as buying emerged at key support levels, though it may be premature to call this a trend reversal amid mixed earnings, cautious global cues and continued FII outflows, said Vinod Nair, head of research at Geojit Investments, adding that “select segments took support from the second quarter results, with broader indices outperforming, led by a sharp rally in the financial sector – especially PSU banks on rising investor appetite, driven due to speculation around an increase in FDI limits and sectoral consolidation.”Going forward, markets will closely monitor the US shutdown and tariff-related developments with US-India and US-China agreements to assess the sustainability of the current momentum, Nair said.

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American markets

The Nasdaq fell on Friday, while the S&P 500 and the Dow Jones Industrial Average managed to post gains in late sessions, capping a volatile week marked by rising economic worries, high-tech valuations and the longest federal government shutdown in US history. All three major indexes were deep in the red for much of the session before paring losses, with the S&P 500 and the Dow turning positive on reports of progress in Congress in breaking the historic impasse. The Dow Jones rose 74.80 points, or 0.16%, to 46,987.10, the S&P 500 added 8.48 points, or 0.13%, to 6,728.80, while the Nasdaq Composite fell 49.45 points, or 0.21%, to 23,004.54.

European markets

European shares closed lower on Friday, capping a choppy week, as persistent concerns about high valuations of technology shares kept investors wary, even as Britain’s ITV rose sharply on reports it could sell its broadcasting unit.

The pan-European STOXX 600 fell 0.6% to 564.79, marking the sharpest decline in two weeks since early September, as renewed concerns about sovereign debt and political instability in France roiled markets.

Technical view

Of late, the Nifty has been trading below the 50 EMA, indicating near-term weakness, says Rupak De, Senior Technical Analyst at LKP Securities. Looking at the broader backdrop, the index has fallen since forming a double top around 26,100 on an hourly basis.

“Recently, the index has fallen below a critical moving average, setting a deeper bearish tone. The crucial resistance is at 25,600; as long as it remains below this level, sentiment may continue to favor a sell-on-rise strategy. On the downside, support is placed at 25,400, and a decline below this level could further boost bear morale,” De said.

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Most active stocks in terms of turnover

Bharti Airtel (Rs 14,259 crore), BSE (Rs 5,312 crore), Amber Enterprises (Rs 2,210 crore), L&T Finance (Rs 2,095 crore), Netweb Technologies (Rs 1,825 crore), HDFC Bank (Rs 1,470 crore) and Infosys (Rs 1,286 crore) were among the most active stocks by value BSE. Higher activity in a counter in terms of value can help identify the counters with the highest trading turnover per day.

Most active stocks by volume

Vodafone Idea (shares traded: Rs 107.54 crore), Suzlon Energy (shares traded: Rs 12.28 crore), YES Bank (shares traded: Rs 8.40 crore), L&T Finance (shares traded: Rs 7.05 crore), Bharti Airtel (shares traded: Rs 7.03 crore), Sagility India (shares traded: Rs 5.44 crore) and Reliance Power (shares traded: Rs 5.44 crore) 4.78 crore) were among the most actively traded stocks on NSE by volume.

Stocks that show buying interest

Shares of L&T Finance, BSE, Swan Energy, Gujarat Mineral Development, CCL Products, Angel One and KFIN Technologies were among the stocks that witnessed strong buying interest from market participants.

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52 Week High

More than 124 stocks hit their 52-week highs today, while 173 stocks fell to their 52-week lows. Shriram Finance, L&T Finance and Bank of India were among those that hit 52-week highs.

Stocks see selling pressure

Stocks that witnessed significant selling pressure were Amber Enterprises, Latent View Analytics, eClerx Services, Sai Life Science, Reliance Infrastructure, Devyani International and Kirloskar Brothers.

Sentiment meter neutral

Market sentiment was neutral. Of the 4,315 shares traded on the BSE on Friday, 2,157 shares saw a decline, 2,016 rose, while 142 shares remained unchanged.

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(Disclaimer: Recommendations, suggestions, views and opinions expressed by the experts are their own. These do not represent the views of the Economic Times)