Markets may see a day in red

2 Nov 2022 , 08:36 AM

Indian equity markets are likely to have a day in red today. Profit booking is likely to take place before Federal Reserve’s announcement regarding interest rate hikes comes later in the day. The gains seen in some of the past few days in US markets indicates that some market participants are factoring in the probability of Federal Reserve becoming more moderate regarding inflation.

Government has reduced windfall tax on exports of crude oil. So oil & gas companies are likely to see movement in their stock prices. Stocks of EIH, Adani Transmissions, M&M Financial Services, JK Bharat etc are likely to see price movement today. These companies will be declaring their September quarter results today.

US markets saw another day of correction yesterday. Investors await Federal Reserve policy action tomorrow, with 75 basis points hike factored in. Dow Jones closed lower by 78 points. Nasdaq lost 97 points. Markets lightened up before the Federal Reserve announcement. US dollar regained strength.  US dollar index is trading near 111. Bond yields remain unchanged at near 4%.

 Asian markets have opened muted today. Japanese ‘Nikkei’ is trading almost flat, down by 33 points .Taiwan and South Korean markets are trading in the green. Yesterday, the big mover was Hang Seng index. It gained over 5% as Chinese stocks rebounded sharply.

Nifty saw another day of gains yesterday.  The index closed near 18200. Foreign buying saw the index move within 2% of its all-time highs. Bank Nifty was the sore spot.  Axis bank led the decline along with Bandhan and IDFC First. HDFC Bank and IndusInd led the gainers, among banks. The big gainers on the index were Adani Ent, Divi’s lab, NTPC and Grasim. Axis Bank, UPL and Eicher Motors saw profit booking.

Technical View: Nifty likely to find support at around 18050. 18400 is likely to act as resistance on the upside. Bank Nifty likely to find support at around 41000. 41800 is likely to act as resistance on the upside. 

TRADING call (1-2 days) BUY SBI LIFE November future @ 1270-1280. Stop loss: 1249.55. Target: 1302

Derivative call- time period:(1 month): Sell Voltas November future @ 905-910. Stop loss: 925. Target: 889