It will be a day of selling in the markets

22 Sep 2022 , 08:39 AM

Indian markets look set to start the day in red. Markets will react negatively to the hawkish stand, once against shown yesterday, by US Federal Reserve.  Federal Reserve increased interest rate by 75 basis points or .75%, yesterday. This is the third consecutive 75 basis point hike by the Federal Reserve in 2022. The US central bank also indicated that one more 75 basis point hike is imminent before the end of this year. On worries of exacerbation of global economic slowdown, due to the Federal Reserve’s hawkishness, oil prices came down yesterday. As markets fall down today, it may be a good time for investors with long term perspective to buy stocks at lower valuations.

US markets saw another volatile day with the Federal Reserve raising rates by 75 basis points. It added that rate hike is the only way to bring down inflation even if it is at the cost of mild recession. Bond yields spiked to hit 3.60% before closing near 3.5%. US dollar index hit 30 year high at 111.Oil prices traded lowest since last November with WTI crude hitting US$ 82 per barrel.
 
 Asian markets have opened in the red, in line with the US sell off. Japanese ‘Nikkei’ is trading lower by 220 points. Taiwan index also seems to be losing big as technology stocks lead the decline. Chinese stocks could see some rear guard buying as valuations get attractive.

Nifty saw another volatile session with last hour profit booking seeing the index close lower by 100 points. Bank Nifty was also under pressure with IndusInd, Bandhan & PNB seeing weakness. Consumer stocks led the gainers. HUL, Britannia and ITC led the gainers. Shree Cement, Power Grid and IndusInd led the losers. Mid-caps also saw profit booking with the Nifty next 50 down by over 1.6%.  
 
Technical View: Nifty likely to find support at around 17490. 18000 is likely to act as resistance on the upside. Bank Nifty likely to find support at around 40500 while 41600 is likely to act as resistance.

TRADING call (1-2 days): Sell Coforge September future @3305-3330. Stop loss: 3383. Target: 3250 

Derivative call- time period:(1 month) Sell Mphasis September future @2060-2080. Stop loss: 2111. Target : 2025