Bulls to regroup after sharp fall; be on your guard on expiry day as volatility likely to rule the roost

Indian markets witnessed a fierce sell-off on Wednesday. As a result, Nifty formed a bearish engulfing pattern on the daily chart. Further, India VIX jumped nearly 10 per cent and closed above the 23 mark. A sharp fall with rising VIX is definitely not a pleasing sign for the bulls. However, at the opening bell, SGX Nifty is indicating that the bulls are likely to regroup after a sharp fall in the previous session as SGX Nifty is up by 57 points and trading at 12,920 levels. The level of 12,940-12,970 is likely to act as a resistance band. Traders would be advised to make an informed decision as volatility is expected to surge on the eve of November F&O expiry. 

Most of the Asian markets were trading in positive territory on Thursday despite a mixed close on Wall Street overnight. Japan’s Nikkei 225 was up by 0.66 per cent, followed by Hong Kong’s Hang Seng, which was up 0.09 per cent. While China’s Shanghai Composite dropped 0.23 per cent.

Bears struck back with a bang on Wednesday as the Indian benchmark indices plummeted over 1.5 per cent. The Indian markets opened the session on an optimistic note and in this process, indices logged fresh record highs in the early session but in the second half of the trading session, things turned ugly, and markets ended deep in the red. The broader markets too declined with Nifty Mid-cap and Small-cap losing 1.65 per cent and 0.89 per cent, respectively. On the sectoral front, barring Nifty PSU Bank, which gained 1.80 per cent, all other indices ended in red with Nifty Realty and Nifty Pharma being the top losers.

Stocks on Wall Street ended on a mixed note on Wednesday as the tech-heavy Nasdaq logged a new record high but on the other hand, Dow retreated from its record high levels and S&P 500 too ended the day with modest losses. Economic data kept Wall Street busy with jobless claims unexpectedly surging in the week ended November 21. Meanwhile, durable goods orders were stronger than expected. At close, Nasdaq advanced 0.5 per cent while Dow and S&P dipped by 0.6 per cent and 0.2 per cent.