Stock market today: Gift Nifty down 28 pts; key levels to watch for Nifty & Nifty Bank

Indian equity benchmark indices are set to open on a muted note on Friday, after snapping their longest daily losing streak in seven months in the previous session, as the central bank's dovish pause and reforms to enhance bank lending boosted sentiment Positive global sentiments shall support the sentiments among traders.

Nifty futures on the NSE International Exchange traded 28.20 points, or 0.11 per cent, down at 24,939.50 hinting at a muted start for the domestic market on Friday. Asian stocks were poised for solid weekly gains on Friday as rising odds of the Federal Reserve cutting rates in the near-term. KOSPI jumped nearly 3 per cent, while Nikkei was up 1.4 per cent.

"We expect positive momentum to sustain on Friday, supported by an accommodative monetary policy, favourable monsoon season and festive-led boost in demand," said Siddhartha Khemka, Head of Research of Motilal Oswal Financial Services.

Wall Street's three major indexes marked record closing highs with modest gains on Thursday, largely thanks to support from the technology sector. The Dow Jones Industrial Average rose 78.62 points, or 0.17 per cent, to 46,519.72. The S&P 500 added 4.15 points, or 0.06 per cent, to 6,715.35 and the Nasdaq Composite rose 88.89 points, or 0.39 per cent, to 22,844.05.

In commodities, gold was steady at $3,857 an ounce, stuck near the record high it touched on Thursday. The yellow metal is for its seventh straight week of gains. Oil prices, on the other hand, were on track for their steepest weekly decline since late June due to market expectations that the OPEC+ group could hike output further despite oversupply concerns.

Markets are more confident of the Fed sticking to its rate cutting path and are almost fully pricing in a 25 basis point rate cut in October. The US dollar is under pressure. The dollar index was steady at 97.895 on the day but on course for a 0.35 per cent weekly decline.

Focus will remain on rate-sensitive sectors, particularly banking, financials, and auto, while metals and energy could also offer selective buying opportunities, said Ajit Mishra, SVP of Research at Religare Broking. "Amid all, traders should avoid getting carried away and stick to a stock-specific approach," he said.

Provisional data available with NSE suggest that FPIs turned net sellers of domestic stocks to the tune of Rs 1,605.20 crore on Wednesday. On the other hand, domestic institutional investors (DIIs) turned buyers of Indian equities to the tune of Rs 2,916.14 crore on a net-net basis.
 

Nifty50 outlook
The 24,950–25,000 zone will act as an immediate resistance for Nifty50 Index. If the index manages to move above the level of 25,000, the pullback can extend further till 25,200 level, said By Sudeep Shah, Head of Technical and Derivatives Research at SBI Securities. "On the downside, the zone of 24,650-24,600 will act as a crucial support for the Index."

Nifty50 has broken the bearish formation of lower highs and lower lows on a daily time frame. Resistances for the Nifty are now seen at 24916 and 25018, derived from 38.2 per cent and 50 per cent retracement of the entire fall seen from 25448 to 24587. On the downside, 24731 could offer support to the Nifty, said Vinay Rajani, Senior Technical & Derivative Research Analyst at HDFC Securities.
 

Nifty Bank outlook
Nifty Bank is trading above its key 21- and 50-day EMAs, currently at 54,940 and 55,120, respectively, indicating that the short- to medium-term trend remains bullish. Support levels have also shifted higher, now positioned around 54,800 and 55,000, providing a solid base for further upside, said Bajaj Broking.

Technically, Nifty Bank formed a big bullish candle, reflecting strength. The trend line resistance for the Bank Nifty is placed near 55,700, which will act as the immediate hurdle, followed by 56,000, said Hrishikesh Yedve, AVP Technical and Derivative Research, Asit C. Mehta Investment Interrmediates. "On the downside, major support is placed near 54,900, where the 100-DEMA is positioned. Thus, traders are advised to adopt a buy on dips strategy in Bank Nifty,” he said.