Markets turn bearish; what should investors do on Friday?

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Indian markets slipped for the second consecutive session on June 17 amid volatility tracking weak global cues after ‘Hawkish’ commentary from the Fed. US Federal Reserve signalled higher rates in 2023 in its policy outcome on Wednesday.

The 30-share BSE Sensex ended 178.65 points or 0.34% lower at 52,323.33. The broader NSE Nifty declined 76.15 points or 0.48% to 15,691.40.

Except IT and FMCG, all sectoral indices on the NSE ended in the red, with Nifty Metal falling over 2%. Broader markets underperformed benchmarks. BSE MidCap and SmallCap indices declined 0.5-1.3%. Nifty Bank also ended 1% lower.

Adani Group companies continued to remain under selling pressure with stocks falling 5-9%. Adani Ports, Tata Steel, IndusInd Bank, Hindalco and Eicher Motors were among the laggards, while TCS, UltraTech Cement, HDFC Life, Tata Consumer and Asian Paints were among the gainers on the Nifty. IT stocks also gained in a weak trading session as rupee slipped against US dollar.

Here’s how experts see markets trading on Friday 

Shrikant Chouhan, EVP, Equity Technical Research, Kotak Securities Ltd

An important event ended in the market yesterday, but today the market was neutral at the level of 15,550/51,700. This confirms that the market trend is strong and may reach the 15,900/52,800 or 16,000/53,100 level once again. Today, Technology stocks and Reliance gave strong support to the index, which allowed the Nifty to close at 15,700. The Nifty/Sensex could reach fresh levels on Friday if the indices don’t close below the levels of 15,550/51,700. On an immediate basis, 15,770/52,500 and 15,850/52,700 levels would be major hurdles. Below the levels of 15,550/51,700, the Nifty/Sensex would gradually fall to 15,400/51,300 or in the worst-case scenario 15,300/51,000.

Ajit Mishra, VP – Research, Religare Broking

Markets extended Wednesday’s fall and lost half a percent, pressurized by weak global cues. The US Fed’s hawkish tone didn’t go well with the equity investors across the globe and we might see the overhang for a session or two. Going ahead, the focus would shift back to fundamentals and domestic factors viz. pace of vaccination drive, reopening by states, etc. Meanwhile, we reiterate our advice of keeping a check on naked leveraged positions and let the markets stabilize.

Manish Shah, Founder, www.Niftytriggers.com

Nifty closed the in the negative territory. Nifty failed to hold above the support at 15780-15800 and it traded below this support. With Nifty trading below this support the index could see some difficulty in moving higher in coming days.

The candle for the day was a long red candle that closed at the lows of the day. The range of the candle was fairly wide and this can be termed as a bearish candle.

What this means is that Nifty could getting ready for a drop to 15600-15650 over next couple of days. Tomorrow is the last day of weekly expiry. Index is likely to stay below 15800 for the current weekly expiry averages pointing up. We can expect to show a steady bullish undertone towards 16000 over next couple of days.