Ahead of Market: 10 things that will decide stock market action on Friday

The Indian market ended higher on Thursday, with the Sensex and Nifty extending gains for a third straight session after the U.S. Federal Reserve trimmed interest rates by 0.25% to support its labour market. Sentiment was also buoyed by recent goods and services tax reforms and progress in trade talks between India and the US.

The S&P BSE Sensex finished 320.25 points, or 0.39%, higher at 83,013.96, while the NSE Nifty 50 advanced 93.35 points, or 0.37%, to 25,423.60.

Here’s how analysts read the market pulse:

Indian equities extended gains after the Fed’s 25 bps rate cut and indication for further easing, with IT and Pharma outperforming on expectations of higher spending and stronger export prospects, said Vinod Nair, Head of Research at Geojit Investments.

“Although elevated valuations and a firm dollar index prompted intermittent profit booking, comfort in private banks and mid & small caps helped in sustaining the positive bias and regain the trend,” said Nair.

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US markets

The S&P 500 and the Nasdaq hit intraday record highs on Thursday, a day after the U.S. central bank delivered a quarter-point interest rate cut, while chipmaker Intel climbed after Nvidia decided to build a stake in the company.Intel jumped 24.6%, and was set for its biggest one-day gain since 1987 after Nvidia said it would invest $5 billion in Intel, throwing its heft behind the struggling U.S. chipmaker. Nvidia was up 2.3%, bouncing back from losses on Wednesday, when a report said Chinese tech firms might stop buying its chips.The stocks boosted the tech-heavy Nasdaq and the S&P 500 technology sector, which was up 1.2%.

European stocks

European shares ended Thursday on a strong note in a chipmaker-driven rally, further powered by the resumption of the U.S. Federal Reserve’s policy-easing cycle, while SIG slumped after a profit warning. The pan-European STOXX 600 ended 0.79% higher at 554.97 points, with the wider technology index leading gains by rising 4.1% – its biggest single-day advance since April 23. The sector was boosted by European semiconductor stocks, which soared in line with their Wall Street counterparts after chip bellwether Nvidia announced plans to invest $5 billion in struggling peer Intel.

Europe’s BE Semiconductor surged 7.9%, while equipment manufacturers ASML and ASMI jumped 7.7% and 8.7%, respectively.

Tech View

The Nifty remained volatile after a gap-up start, driven by a dovish Fed announcement, with the short-term trend likely to stay positive as the index is comfortably trading above its critical moving average, said Rupak De, Senior Technical Analyst at LKP Securities, adding that the daily RSI is in a bullish crossover and rising above the previous swing high, indicating strengthening momentum.

“In the near term, support is placed at 25,300 and 25,150. On the other hand, crucial resistance is seen at 25,500. A decisive move above this level could trigger a rally towards 26,000. Overall, a buy-on-dips strategy remains favorable in the current market scenario,” said De.

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Most active stocks in terms of turnover

Suven Pharma (Rs 3,935 crore), Poonawalla Fincorp (Rs 3,323 crore), HDFC Bank (Rs 1,734 crore), Infosys (Rs 1,442 crore), GRSE (Rs 1,401 crore), RIL (Rs 1,321 crore) and Eternal (Rs 1,222 crore) were among the most active stocks on BSE in value terms. Higher activity in a counter in value terms can help identify the counters with highest trading turnovers in the day.

Most active stocks in volume terms

Vodafone Idea (Traded shares: 59.65 crore), YES Bank (Traded shares: 7.86 crore), HFCL (Traded shares: 7.51 crore), Poonawalla Fincorp (Traded shares: 6.66 crore), Sagility India (Traded shares: 5.91 crore), Suven Pharma (Traded shares: 4.33 crore) and Eternal (Traded shares: 3.65 crore) were among the most actively traded stocks in volume terms on NSE.

Stocks showing buying interest

Shares of Poonawalla Fincorp, Tata Investment, Zen Tech, Swan Energy, Biocon, Newgen Software and Netweb Technologies were among the stocks that witnessed strong buying interest from market participants.

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52 Week high

Over 170 stocks hit their 52 week highs today while 48 stocks slipped to their 52-week lows. Among the ones which hit their 52 week highs included Eternal and Maruti Suzuki.

Stocks seeing selling pressure

Stocks which witnessed significant selling pressure were Tata Motors, Bajaj Finance, UltraTech Cement, Asian Paints, IndusInd Bank, Titan Company and SBI.

Sentiment meter neutral

The market sentiments were neutral. Out of the 4,342 stocks that traded on the BSE on Thursday, 2,083 stocks witnessed declines, 2,097 saw advances, while 162 stocks remained unchanged.

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(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of the Economic Times)