Ten factors affecting Monday's stock market

 

After riefly topping 60,000 in early trade on Friday, the Sensex recovered to settle up 105 points. The information technology group had the most significant percentage increase, at over 2%.

This is how market analysts interpret the current climate:

Kotak Securities Ltd.'s Deputy Vice President - Technical Research Amol Athawale, "Even if the market lost some of its early gains, the Sensex crossed the 60,000 thresholds on the day, showing investors are optimistic about the domestic economy. India's long-term growth potential provides stability when an economic slowdown in key economies is staring at recession fears, even if stock markets look overpriced. Upon breaking beyond 18,000, he predicts that Nifty will surge to 18,3000, with support coming in around 17800 and 17600.

 Vinod Nair, head of research at Geojit Financial Services NSE -0.21%, said global markets and macroeconomic data would decide market direction next week. These data points include inflation and manufacturing and industrial production figures. Forecasts put August's domestic retail inflation at 6.9%, up from July's 6.71%."

To that end, let's take a look at what a few major indicators are predicting for Monday's events:

The Markets in the United States Raise Their Pricesc

US equities rose on Friday, capping off a successful week for Wall Street as it recovered from a drop caused by the Federal Reserve. Dow Jones Industrial Average rose 377.19 points, or 1.19 per cent, to 32,151.71. The Nasdaq Composite increased by 2.11% to 12,112.31, and the S&P 500 gained 1.53% to 4,067.36.

Stocks in Europe End on a Positive Note

Investors responded positively to a record rate hike by the European Central Bank and additional comments from Federal Reserve Chair Jerome Powell, sending European markets higher by Friday's closing. All industries and significant European exchanges closed the day in the black, putting a provisional 1.6% gain for the pan-European Stoxx 600 in the black. Gains were led by a 3.2% increase in mining stocks, while tech companies rose 2.7%.

Forecasting Technology: Daily Bearish Candle

For the first time in eight months, Friday's closing price on the Nifty50 index was higher than 17,800.

Nonetheless, a daily candlestick pattern evolved that was negative. The NSE index created a bullish candle on weekly charts for the second week.

Financial instruments with a bullish inclination

Moving Average Convergence Divergence (MACD) for scrips like Nazara Technologies NSE 10.98%, Gujarat StatePetronet, Max indicated a sign of present momentum Bullish trade scenario Healthcare NSE 9.14%, Axis Bank, Indian Energy Exchange NSE -0.38%, and Birlasoft.

A well-known function of the MACD is foretelling price trend changes for publicly traded stocks and indices. A positive signal is issued when the MACD line climbs above the signal line, indicating a likely price increase.

Warning signs for stocks

Canara Bank NSE (-0.59%), Titagarh Wagons NSE (-8.22%), Jubilant Foodworks NSE (-1.05%), KRBL (-2.13%), and Aptus Value Housing (-2.1%) all had negative MACD signals.

The MACD for these stocks has just crossed down, signalling the beginning of a bearish trend.

Value-wise, the most-active stocks.

 Adani Ports (NSE 2.46%; Rs 1,513 crore), Ambuja Cements (NSE 1.15%; Rs 1,155 crore), Shree Cements (NSE 0.19%; Rs 939 crore), HDFC Bank (NSE 0.892%), and SBI (NSE 8.51%) were among the most frequently traded securities on the NSE. Those counters with the most significant trading turn throughout the day tend to have higher daily value-based activity.

There were several highly traded stocks on NSE during the day, including Tata Steel (shares traded: 3.75 crores), Adani Ports SEZ NSE 2.46% (shares exchanged: 1.66 crores), SBI (shares traded: 1.54 crore), NTPC (shares traded: 1.36 crore), and Tata Motors NSE 0.84% (shares traded: 1.15 crore).

Companies' shares that have generated buyer interest

Strong purchasing interest from market players helped push shares of companies, including Adani Ports SEZ, SBI, ITC, ICICI Bank NSE 0.27%, and M&M, to new 52-week highs, a sign of optimistic confidence in the market.

Investors are becoming bearish on stocks.

The stock price of Natco Pharma NSE -0.84% fell to a 52-week low, indicating investors are pessimistic about the company.

Bears top the emotional thermometer.

The market breadth favoured the bears, with 1,798 declining equities and 1,658 increasing ones.

Disclaimer: All expert advice, ideas, views, and comments are strictly those of the experts. The opinions expressed here are not those of the Economic Times.