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

The Indian market ended lower on Tuesday after a brief morning boom, only to fall apart just as quickly, leaving investors with sharp intraday losses and a renewed sense of unease. The BSE Sensex fell as much as 933 points from the day’s peak, while the Nifty 50 fell over 1%, wiping out Rs 2.6 lakh crore in market value as selling pressure intensified during the session.The Sensex, which touched an intraday high of 84,258.03, fell to a low of 83,324.84. The Nifty fell from its peak of 25,899.80 to an intraday trough of 25,627.40. At the end of the day, the Sensex fell 250 points (0.3%) to close at 83,627.69, while the Nifty fell 58 points (0.22%) to end the day at 25,732.30.

This is how analysts read the market pulse:

Domestic equities witnessed a downturn on renewed concerns over possible US tariffs on countries trading with Iran, overshadowing the initial optimism from the newly appointed US ambassador’s positive statements on the trade deal, said Vinod Nair, head of research at Geojit Investments, adding that investor sentiment remained cautious amid rupee weakness, rising crude prices, higher US bond yields and continued FII outflows. “On a more positive note, India’s CPI remained within the RBI target in December, reinforcing expectations of future rate cuts. However, the third quarter earnings season started on a subdued note, with lackluster results from a leading IT company. Profit bookings were dominant across most sectors, although small-cap stocks posted notable gains,” Nair said.

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American markets

The S&P 500 and Nasdaq held steady Tuesday after a largely in-line inflation report kept expectations of rate cuts this year, while investors weighed mixed quarterly results from JPMorgan and Delta Air Lines. Excluding volatile food and energy components, U.S. consumer prices rose 0.2% in December from the previous month, softer than economists’ forecast of a 0.3% increase. Total and core CPI rose 2.6% year-on-year last month, after rising by the same margin in November.The data reinforced Fed bets on at least two more 25 basis point rate cuts between June and December, with traders seeing a slim one-third chance, according to LSEG data.

European markets

European stock markets were mixed after a reading in US consumer prices suggested inflation is easing – although not enough to prompt the Federal Reserve to make early interest rate easing.

Europe’s STOXX 600 reversed earlier gains to trade 0.27% lower at 609.27.

Technical view

Technically, the Sensex respected the support zone around 83100-83200, which acted as a solid buffer to session lows, said Hitesh Tailor, technical research analyst at Choice Broking, adding that the immediate resistance is now near 84100-84200, where previous upward attempts were capped before the late-day weakness.

“Failed to sustain early gains and maintain a close below key psychological levels, the structure currently favors a neutral to cautious stance, with selective accumulation on dips as long as the support zone remains intact,” Tailor said.

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Most active stocks in terms of turnover

HDFC Bank (Rs 3,013 crore), ICICI Bank (Rs 2,048 crore), RIL (Rs 1,968 crore), Larsen & Toubro (Rs 1,940 crore), BSE (Rs 1,896 crore), TCS (Rs 1,836 crore) and Hindustan Copper (Rs 1,632 crore) were among the most active stocks by value on 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 105 crore), IFCI (shares traded: Rs 18.5 crore), Ola Electric Mobility (shares traded: Rs 7.7 crore), Suzlon Energy (shares traded: Rs 7.5 crore), YES Bank (shares traded: Rs 6.6 crore), Bank of Maharashtra (shares traded: Rs 5.1 crore) and Eternal (shares traded: Rs 5 crore) were among the most active by volume shares traded on NSE.

Stocks that show buying interest

Shares of Authum Investment, Maharashtra Scooter, PVR, Motilal Oswal, City Union Bank, Oil India Ltd and Manappuram Finance were among the stocks that witnessed strong buying interest from market participants.

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52 Week High

More than 82 stocks hit their 52-week highs today, while 532 stocks fell to their 52-week lows. SBI and Vedanta were among those that hit 52-week highs.

Stocks see selling pressure

Stocks that witnessed significant selling pressure were Dixon Tech, Vodafone Idea, Au Small Finance Bank, Trent, HEG, Larsen & Toubro and Graphite India.

Sentiment gauge bearish

Market sentiment was bearish. Of the 4,327 shares traded on the BSE on Friday, 2,143 shares saw a decline, 1,989 rose, while 195 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)