Will Nifty Ascend Beyond 23,100 to Achieve a New Zenith or Stabilize? Examine GIFT Nifty, FII Data, F&O Ban, Crude, and More Prior to Market Opening

GIFT Nifty suggested that Indian equity benchmarks BSE Sensex and NSE Nifty 50 might commence on an optimistic note this Monday. Here’s the crucial intel you need before the trading bell rings.

GIFT Nifty dipped by 8.50 points or 0.04%, standing at 23,031, foreshadowing a tepid commencement for domestic indices NSE Nifty 50 and BSE Sensex. On the preceding Friday, the NSE Nifty 50 closed lower by 10.55 points or 0.05%, settling at 22,957.10, while the BSE Sensex declined marginally by 7.65 points or 0.01%, closing at 75,410.39.

“Markets exhibited a tranquil demeanor post-Thursday’s surge, culminating in an almost unchanged state. Despite an insipid start, Nifty traversed within a narrow corridor throughout the session, briefly touching the milestone of 23,000. Meanwhile, sectoral trends were mixed; auto, banking, and financial sectors flourished, while FMCG and realty sectors experienced profit-booking. The broader indices mirrored this muted activity, closing nearly flat,” remarked Ajit Mishra, SVP, Research, Religare Broking.

Mishra further articulated that it is typical to witness a pause after a significant upward movement, advising traders to consider any dip around the 22,750-22,850 range in Nifty as a buying prospect. While key sectors are propelling the upward momentum, there is now more selective participation. Consequently, stock selection should focus on large-cap and substantial mid-cap stocks.

Key Insights Before the Market Opens on May 27, 2024

Wall Street: US equities ascended after data indicated that American consumers moderated their inflation expectations, buoying sentiment for potential Federal Reserve rate cuts this year, reported Bloomberg. The tech-centric Nasdaq Composite surged by 184.76 points or 1.10%, closing at 16,920.79. The S&P 500 advanced by 36.88 points or 0.70%, finishing at 5,304.72, while the Dow Jones Industrial Average edged up by 4.33 points or 0.01%, ending at 39,069.59.

US Dollar: The US Dollar Index (DXY), which quantifies the dollar’s value against a basket of six foreign currencies, marginally decreased by 0.03%, trading at 104.72.

Crude Oil: WTI crude prices ascended to $77.88, up by 0.10%, while Brent crude prices increased to $82.25, up by 0.11%, as of Monday morning.

Asian Markets: Asian markets exhibited a mixed trajectory on Monday. The Asia Dow declined by 0.45%, whereas Japan’s Nikkei 225 advanced by 0.17%, Hong Kong’s Hang Seng index fell by 1.38%, and the Shanghai Composite index dropped by 0.88%.

FII, DII Data: Foreign institutional investors (FII) divested shares worth Rs 944.83 crore, while domestic institutional investors (DII) acquired shares worth Rs 2,320.32 crore on May 24, 2024, as per provisional data from the NSE.

F&O Ban: The NSE has included Bandhan Bank, Biocon, GNFC, Hindustan Copper, Vodafone Idea, Indian Cement, NALCO, Piramal Enterprises, and Punjab National Bank in the F&O ban list for May 27, 2024.

Technical View: Rupak De, Senior Technical Analyst at LKP Securities, noted that Nifty maintained a sideways movement after surpassing 23,000. Sentiment may remain subdued in the coming days, with the index oscillating between 22,950 and 23,050. Significant call and put writing at 23,000 indicates a likely range-bound trade in the near term. A decisive dip below 22,950 might push the index toward 22,800, while a sustained move above 23,050 could lead to a meaningful rally.

Bank Nifty Outlook: “The Bank Nifty showcased resilience throughout the day, bolstered by HDFC Bank’s strength. Looking ahead, sentiment is likely to remain positive as long as the index stays above 48,500. Any dips towards 48,500 might attract buying interest. Immediate resistance is pegged at 49,000, above which the index might advance towards 49,500. Immediate support lies at 48,800,” stated Rupak De, Senior Technical Analyst, LKP Securities.