Nifty back above 15,600 mark; India VIX slips below 15-mark, Nifty FMCG & Nifty Pharma trade in green
Market Update at 2:30 PM: Indian markets have recovered smartly from the lower levels. Nifty recovered nearly 180 points from the lower levels and also, reclaimed its 15,600 level. The broader markets relatively underperformed the frontline indices with Nifty Midcap 100 and Smallcap 100 being down by 1.25 per cent and 1.35 per cent, respectively. Interestingly, India VIX has slipped back below the 15-mark.
Among the sectoral indices, barring Nifty FMCG & Nifty Pharma, all other indices were trading in the red.
Market Update at 11:14 AM: Nifty has witnessed its sharpest fall in the recent days. It has slipped below its 20-DMA as well as the prior week low. Besides, India VIX has jumped more than 6 per cent and it’s above the 16-mark.
Now, the question arises as to what is causing the wreck in the markets? The US 10-year bond yield is above 1.5 and the US Dollar Index is inching close to the 92-mark.
The breadth of the market is adversely impacted as only 4 stocks of Nifty 50 were trading in green. On the other hand, the overall breadth is significantly in the favour of declines as about 1,600 stocks traded in red while only 110 stocks were trading in green.
Market Update at 10:00 AM: Indian markets began the final trading session of the week on a positive note; however, it failed to capitalise on early gains as profit booking emerged and it slipped into a negative terrain.
Both Nifty and Sensex are down by more than half a per cent. Selling pressure is more intense in the broader markets as Nifty Mid-cap and Small-cap are down by 1.22 per cent and 0.90 per cent, respectively. Meanwhile, India VIX jumped over 3.5 per cent.
All the sectoral indices are trading in red, led by Nifty Metal & Nifty Energy. All the constituents of Nifty Metal are trading in red, except one stock. VEDL, SAIL, JSW Steel, and Tata Steel are down in the range of 2.52-4.19 per cent.
Among stock-specific action, IFB Agro Industries jumped 14 per cent and also, made a fresh 52-week high.
After two days of fall, the early indication from SGX Nifty is indicating that the Indian benchmark indices are ready for a rebound on Friday. SGX Nifty was trading up by 62.50 points or 0.40 per cent at 15,755.
The Indian markets ended in red for the second day in a row on Thursday. The market breadth was in favour of declines and more importantly, barring Nifty IT & Nifty FMCG, all other indices ended in the red. Nifty Metal was down by 2.32 per cent and on a WTD basis, it is down by more than 5 per cent. The volatility index i.e. India VIX climbed 2.84 per cent to 15.28.
Technically, Nifty, after a 12 per cent rise from the lows of 14,151 to an all-time high, is reverting to its mean of 20-DMA. Nifty is approaching the 20-DMA support of 15,576, just 0.73 per cent away. The recent low is placed at 15,566. Hence, this is an important support zone for the index. A weekly close below this level would mean that it is closing below the previous week's low. This would be another weak signal for the market.
The RSI has already fallen below the prior minor swing low, and it looks like a double top breakdown. The daily MACD has given a fresh sell signal.
Overall, it would be important to see whether the index holds its 20-DMA support or not.