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

Indian equities ended down on Monday, witnessing their second successive negative closing amid selling pressure in IT, metals and pharmaceutical stocks.

While Nifty 50 ended at 22122.05, with a 0.4% loss, the 30-stock S&P BSE Sensex fell 0.5% to settle at 72790.13.

Here’s how analysts read the market pulse:

“Despite the overall bullish tone, negative divergence on key momentum indicators suggests caution, particularly against aggressive long positions, especially overnight ones. Traders are advised to monitor these levels closely and adjust their trading strategies accordingly,” said Rajesh Bhosale, technical analyst, Angel One.

US markets
US stocks edged higher in early trade on Monday, while investors are bracing for a busy week of data and seek more catalysts to ride the market further up, following a boost from Nvidia last week.

European shares

European equities edged lower on Monday, starting the new week on a cautious note, as investors awaited the release of inflation data. Eurozone is slated to release the inflation data on Friday, which will be closely tracked as it would be before the upcoming European Central Bank meeting on March 7.The pan-European STOXX 600 was down 0.3%, while benchmark indices in France and the UK were down around 0.4%. Tech view
Nagaraj Shetti, senior technical analyst at HDFC Securities said, “Positive chart pattern like higher tops and bottoms are intact and present weakness could be in line with a new higher bottom formation.”

Hence, the Nifty is expected to find strong support around 21900-21850 levels. On the upper side, the area of 22200-22300 is likely to be a strong hurdle for the markets ahead, Shetti said.

Stocks showing bullish bias
Momentum indicator Moving Average Convergence Divergence (MACD) showed bullish trade on the counters of Sobha Ltd, Bharat Dynamics, Mahindra Holidays, Adani Total Gas, KPR Mill, among others.

The MACD is known for signaling trend reversals in traded securities or indices. When the MACD crosses above the signal line, it gives a bullish signal, indicating that the price of the security may see an upward movement and vice versa.

Stocks signaling weakness ahead
The MACD showed bearish signs on the counters of KSB Ltd, IndiaMART InterMESH, Bank of Baroda, NTPC, Bayer Cropscience, Team Lease Services, among others. Bearish crossover on the MACD on these counters indicated that they have just begun their downward journey.

Most active stocks in value terms
Jio Financial Services (Rs 3602.89 crore), HDFC Bank (Rs 1676.06 crore), L&T (Rs 1428.27 crore), Alkem Labs (Rs. 1260.59 crore), Indus Towers (Rs. 1178.26 crore), Adani Gas (Rs. 1149.35 crore), and RIL (Rs. 1117.32 crore), were among the most active stocks on NSE in value terms. Higher activity on 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: 64.36 crore), YES Bank (Traded shares: 27.11 crore), GTL Infra (Traded shares: 19.46 crore), Jio Financial Services (Traded shares: 10.74 crore), NHPC (Traded shares: 9.17 crore), Infibeam Avenues (Traded shares: 9.08 crore), were among the

Most actively traded stocks in volume terms on NSE.

Stocks showing buying interest
Shares of Power Grid Corp, Adani Ports, Adani Enterprises, SBI Life Insurance and M&M are among the stocks that witnessed strong buying interest from market participants as they scaled their fresh 52-week highs, signaling bullish sentiment.

Stocks seeing selling pressure
Shares of Orient Refractories, Polyplex Corporation. And Sharda Cropchem hit their 52-week lows, signaling bearish sentiment on the counters.

Sentiment meter favours bulls
Overall, market breadth favoured bears as 2,312 stocks ended in the red, while 1,665 stocks settled in the green.

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

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