Nifty to take cues from global market

The domestic market witnessed selling pressure as the S&P BSE Sensex ended in the red with a loss of 188 points, or 0.50 per cent, to close at 37,663. The Nifty 50 Index shed 50 points, or 0.44 per cent, to settle at 11,385.05. Selling was seen in metal and mining stocks and also on heavyweights like Reliance Industries. The broader market also fell with the BSE Mid-Cap Index down 0.48 per cent and the Small-Cap falling 0.20 per cent.

Technical view 

Mustafa Nadeem, CEO, Epic Research, said: “The Indian equity market takes a hit as global and domestic cues gives jitters to investors across the globe. The Nifty witnessed an inside day as the trading range was within the previous session. The consolidation may continue between 11,360 to 11,450 on the upside. 

“The global markets saw a sell-off last night on the back of a weaker number from IT giant and a round of selling in technology stocks. The Volatility Index for S&P 500 was seen rising 30 per cent at one point of time, given the rush towards puts. Copper fell almost 5-6 per cent that lead to worries of a global slowdown.  

“Adding to that, Indian markets opened the day negative given the trade deficit data that widened to $18.02 billion in July, a five-year high. This was largely due to a jump in crude oil imports that went up at $12.35 billion.”

He addded: “We expect the Nifty to take its cues from global markets and movement of crude oil. Both of these factors will try to test the bulls and bears. The Nifty has very strong support at 11,350-11,340 as a medium-term trend line continues to support it, though, a close below it on the flipside will be pushing the Nifty into a correction phase and test lower levels of 11,180.”

Market view 

Vinod Nair, head of research, Geojit Financial Services, said: " Market slid as depreciation in rupee on account of widening trade gap impacted investors sentiment. Additionally, domestic yield surged due to concern on inflation and weakness in rupee. Moderation in oil price and expectation of reversal in FII inflow due to pick up in earnings will cap downside. On the sectoral front, metal & PSU bank underperformed while IT & pharma gained owing to deprecation in rupee."

—Ashwin Punnen