Mumbai: The Indian stock market opened cautiously on Thursday as mixed Q3 earnings and selloffs in oil, gas, and banking stocks impacted investor sentiment.
The benchmark indices, Nifty and Sensex, witnessed early declines before showing slight recovery during the trading session.
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Key Market Movements
In early trade, the NSE Nifty 50 fell by 0.28% to 23,090, while the BSE Sensex slipped 0.27% to 76,202. Despite the cautious start, gains were observed shortly afterward, reflecting some recovery.
- Nifty Performance: The index faced resistance near 23,300, with potential upward targets at 23,600–23,800. On the downside, support was observed at 23,000, with a breach possibly dragging it to 22,800.
- Sectoral Trends: Out of 12 sectors on the NSE, 10 declined, with Nifty FMCG and Nifty Oil & Gas experiencing the most significant losses. However, Nifty IT and Media sectors registered gains.
- BSE Sectoral Data: On the BSE, six out of 20 sectors advanced, with IT and Focused IT leading the gains.
Stock Highlights
- HDFC Bank: The stock marginally rose to Rs 1,671.95 following strong Q3 results. Despite slower loan growth, brokerages remain optimistic about the bank due to its resilience in a challenging macroeconomic environment.
- Declining Stocks: ICICI Bank, Hindustan Unilever, Larsen & Toubro, and State Bank of India weighed heavily on the Nifty 50.
Market Sentiment and Insights
Market watchers noted a volatile trading session on Wednesday, with selling pressure dragging the Nifty index to the previous day’s lows. However, buying activity at lower levels helped the index recover to close around 23,150.
- Global Impact: Positive sentiment from global markets, particularly the Asia-Pacific region, influenced domestic trading. The Wall Street rally, driven by optimism over mega AI initiatives in the US, also contributed to this trend.
- FIIs and DIIs: Foreign Institutional Investors (FIIs) continued to offload equities, selling Rs 4,026 crore worth of stocks on January 22. In contrast, Domestic Institutional Investors (DIIs) provided some support by purchasing equities worth Rs 3,500 crore.
Also Read | Sensex and Nifty Slip After Initial Gains; Reliance, Zomato Among Top Drags
Global and Domestic Market Trends
- Global Markets: Asia-Pacific markets traded mixed, reflecting global economic concerns and optimism over artificial intelligence investments.
- Domestic Trends: Despite global positivity, FIIs’ prolonged selling spree has raised concerns about the sustainability of upward momentum in Indian markets.
Broker Recommendations and Resistance Levels
- Key Resistance Levels: The Nifty 50 is expected to face immediate resistance at 23,300. A breakout above this level could propel the index toward 23,600–23,800.
- Support Levels: Immediate support is seen at 23,000, with potential for the index to dip to 22,800 if breached.
- Brokerage Opinions: Analysts have trimmed earnings estimates for HDFC Bank but remain positive on its long-term performance due to its strong fundamentals.
Precautionary Steps for Investors
Given the current market volatility, investors are advised to:
- Diversify Portfolios: Spread investments across sectors to mitigate risks.
- Monitor Global Cues: Keep track of international developments, particularly in the US and Asia-Pacific regions.
- Follow Key Resistance and Support Levels: Use technical indicators to guide entry and exit points.
- Focus on Long-Term Growth: Invest in fundamentally strong companies for sustained returns.