Stock market today: Gift Nifty up 46 points; key levels for Nifty, Sensex & Nifty Bank

Indian benchmark indices are likely to open little changes, mildly positive, on Wednesday amid the absence of major cues around tensions in West Asia. Traders will be looking at the US Fed's policy meeting kicking-off later today. Cautious stance is likely to continue amid value buying in select beaten down pockets.

Nifty futures on the NSE International Exchange were 46.10 points, or 0.20 per cent, up at 23,663.50, hinting at a positive start for the domestic market on Wednesday. Asian shares rallied on Wednesday as oil prices paused their gains amid ongoing geopolitical tensions in the Middle East. KOSPI surged nearly 4 per cent, while Nikkei jumped over 2 per cent. Hang Seng was flat.

The sustainability of the up move remains contingent on meaningful de-escalation in geopolitical tensions and moderation in crude oil prices, said  Siddhartha Khemka, Head of Research at Motilal Oswal Financial Services. "Markets will closely track developments in West Asia and movements in crude oil prices. While the near-term recovery may sustain, further upside will depend on easing geopolitical risks."

Wall Street ended higher on Tuesday as the US Fed began its ​two-day policy meeting amid investors' worries about high oil prices and the Middle East conflict. The S&P 500 climbed 0.25 per cent to end the session at 6,716.09 points. The Nasdaq gained 0.47 per cent to 22,479.53 points, while the Dow Jones Industrial Average rose 0.10 per cent to 46,993.26 points.

The dollar held losses on Wednesday as a glimmer of risk appetite came back to markets ahead of a slate of key central bank decisions. The dollar index traded at 99.56 after a two-day decline. The dollar reached a 10-month high at the end of last ​week as the Middle East conflict and rising oil prices prompted investors to seek safety in US assets.

Oil prices slightly fell on Wednesday morning after sources citing American Petroleum Institute figures showed an ​increase in US crude inventories. Brent futures dropped 1.11 per cent, to $102.27 ‌a barrel, while US West Texas Intermediate crude declined 1.6 per cent, to $94.67.

Apart from relatively stable global markets, optimism surrounding the partial normalization in global supply chains and stability in the rupee supported the rebound, said Ajit Mishra, SVP of Research at Religare Broking. "We maintain to avoid aggressive positioning, stay selective and focus on disciplined risk management until stability appears in crude oil prices and global markets."

Provisional data available with NSE suggest that FPIs turned net sellers of domestic stocks to the tune of Rs 4,741.22 crore on Tuesday. On the other hand, domestic institutional investors (DIIs) turned buyers of Indian equities to the tune of Rs 5,225.32 crore on a net-net basis.
 

Nifty50 & Sensex outlook

The market is comfortably trading above the 23,300/75,300 support zone. A bullish candle on daily charts and an uptrend continuation formation on intraday charts indicate that a pullback is likely to continue in the near future. 23,350 and 23,300/75,500-75,300 would act as crucial support zones, said Shrikant Chouhan, Head of Equity Research at Kotak Securities.

"Above these levels, the pullback could continue till 23,800/76,500. Further upside may also persist, potentially lifting the index to 23,950/77,000. On the flip side, below 23,300/75,300, sentiment could change. If the index drops below this level, traders may prefer to exit their long positions," he said.

Nifty has moved above the 21 EMA on the hourly timeframe. The sentiment is likely to remain slightly positive, with a possibility of a rise towards 23,800–24,000., said Rupak De, Senior Technical Analyst at LKP Securities. "On the lower end, crucial support is placed at 23,400. A fall below this level might reactivate the bears in the market. Below 23,400, it may fall back to 22,950."
 

Nifty Bank outlook

Nifty Bank witnessed a strong rebound, forming a bullish candle with a long lower shadow—signalling demand at lower levels, said Sudeep Shah, Head of Technical and Derivatives Research at SBI Securities. "55,250–55,300 is likely to act as a key resistance. A decisive move above 55,300 could pave the way for further upside towards 55,800. On the downside, the 54,400–54,300 band is expected to provide crucial support."

Nifty formed a small bullish candle with shadows in either direction signaling extension of pullback for the second session in a row after recent sharp decline. Volatility is expected to remain elevated in the near term amid uncertain global cues and rising geopolitical tensions, which continue to weigh on overall market sentiment, said Bajaj Broking.

"The index has recently rebounded from the extreme oversold territory. Hence, holding above Monday’s low can lead to some consolidation in the range of 55,800-53,250. The index needs to start forming higher highs and higher low on a sustained basis to signal a pause in the current downtrend," it added.