Global cues spoil sen­ti­ment

Money Times - - Front Page - By San­jay R. Bha­tia

The In­dian stock mar­ket started on a pos­i­tive note last week mov­ing higher to­wards the psy­cho­log­i­cally im­por­tant 11K mark on the back of fall­ing crude oil prices and pos­i­tive global mar­kets. How­ever, the fi­nal rate hike of the year in USA along with its shut­down news spooked the mar­ket sen­ti­ment glob­ally. The In­dian mar­kets were no ex­cep­tion as they wit­nessed a sell-off on Fri­day. The breadth of the mar­ket re­mained firm dur­ing the week amidst high vol­umes, which is a pos­i­tive sign for the mar­kets and in­di­cates broad-based buy­ing sup­port.

The FIIs were net buy­ers in the cash and deriva­tives seg­ment ahead of the fes­tive hol­i­days. The DIIs, how­ever, turned net sell­ers and were seen book­ing prof­its at the higher lev­els. The

US Fed­eral Re­serve hiked in­ter­est rates by 25 bps and in­di­cated two hikes next year be­fore in­ter­est rates reach their peaks. Crude oil prices moved lower on the back of high in­ven­to­ries and sup­ply amidst re­newed con­cerns of slower global eco­nomic growth. How­ever, crude oil prices bounced back on Fri­day ahead of the OPEC pro­duc­tion cuts that start next month. On the do­mes­tic front, the gov­ern­ment plans to in­fuse Rs.830 bil­lion into pub­lic sec­tor banks in the re­main­ing months of FY19, tak­ing cap­i­tal in­jec­tion into lenders to Rs.1.06 tril­lion in this fis­cal. Tech­ni­cally, the pre­vail­ing neg­a­tive tech­ni­cal con­di­tions weighed on the mar­ket sen­ti­ment. The Stochas­tic and KST are placed be­low their re­spec­tive av­er­ages on the daily and weekly charts. Fur­ther, the MACD is placed be­low its av­er­age on the weekly chart while the RSI is placed be­low its av­er­age on the daily chart. More­over, the Nifty has slipped be­low its 200-day SMA and is placed be­low its 100-day SMA. The Nifty’s 50-day SMA is also placed be­low its 100-day SMA and 200-day SMA sig­nal­ing a ‘Death Cross’ break­down. All these neg­a­tive tech­ni­cal con­di­tions could lead to fur­ther sell­ing pres­sure, espe­cially at the higher lev­els.

The pre­vail­ing pos­i­tive tech­ni­cal con­di­tions, how­ever, still hold good. The MACD is placed above its av­er­age on the daily chart. Fur­ther, the RSI is placed above its av­er­age on the weekly chart. More­over, the Nifty is placed above its 50-day

Now fol­low us on In­sta­gram, Face­book & Twit­ter at mon­ey­times_1991 on a daily ba­sis to get a view of the stock mar­ket and the hap­pen­ings which many may not be aware of.

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