Dalal Street Corner: Profit Booking in Banking, Financial Stocks Force Market Close Near 1%; what should investors do on thursday

Indian markets ended nearly 1% lower as gains in banking and financial stocks sent leading indices tumbling amid weak global signals on Wednesday. The benchmark Nifty 50 and Sensex indexes fell 0.94% each on global market selling as high energy prices weighed on the domestic stock market on Wednesday. Although all sectors slipped into the red, it was banking, financials, oil and gas and consumer durables that came under huge pressure on Wednesday.

“The market continued to experience high volatility following a strong sell-off in global markets prompted by a high energy crisis and a weak Chinese economic outlook underpinned by prospects for US rate hikes. United,” said Vinod Nair, head of research at Geojit Financial Services.

Investors are pricing in the possibility of a global slowdown due to central bank monetary tightening, China’s lockdown and the Russia-Ukraine war, the expert said. “This has led to an outflow of funds from stock markets to safe havens,” he added.

Meanwhile, the Nifty 50 closed just above 17,200 and the Sensex near 56,800 as only 10 and 6 stocks respectively advanced on the benchmarks.

In the broader market, shrewd mid caps fell 0.86% and small caps fell 0.61% as India’s volatility index edged closer to 21 marks.

Speaking on the Nifty technical chart, Gaurav Ratnaparkhi, Head of Technical Research, Sharekhan of BNP Paribas, said the index, with a minor bounce on April 26, hit a descending trendline on the hourly chart. , which was around 17200. , the index fell on April 27, he said.

“Structurally, the price action over the past few sessions has taken the form of a triangular pattern, which should be a continuation pattern in this case. The index may see a brief consolidation in the range of 17150-16900 and may eventually break out lower,” he said.

So, from a short-term perspective, the Nifty should test the 16824 swing low, below which 16600 will be the next target to watch, the expert added.