The benchmark Sensex and Nifty are expected to open modestly down on November 7, with the GIFT Nifty indicating a 16-point drop for the wider market.
The BSE Sensex advanced 595 points to 64,959, followed by positive Asian signals and purchasing in all significant sectors with the exception of PSU Bank, while the Nifty50 advanced 181 points to 19,412 and established a bullish candlestick pattern on the daily charts, surpassing the 100 and 21-day EMAs.
“The previous three sessions’ opening upside gap remains intact.” This market activity indicates a substantial positive comeback in the market following the creation of a key bottom reversal on October 26 around 18,837 levels,” said Nagaraj Shetti, technical research analyst at HDFC Securities.
The market is presently progressing towards the next overhead barrier of roughly 19,550-19,600 levels in the short term, he said, adding that immediate support is positioned at 19,320 levels.
According to the pivot point calculator, the Nifty may find support at 19,338, followed by 19,311 and 19,268. On the upside, 19,425 may be the first point of resistance, followed by 19,452 and 19,495.
Nifty GIFT
With a drop of 16 points, the GIFT Nifty implies a somewhat bearish start for the wider market. GIFT Nifty futures were at 19,465 points, having reached a high of 19,473 points.
The US Markets
Stock futures were down on Monday evening as investors weighed whether the Wall Street bounce might continue. Dow Jones Industrial Average futures fell 61 points, or around 0.2 percent. The S&P 500 and Nasdaq 100 futures both fell by about 0.2 percent.
Stocks rose during normal trading on Monday, with the tech-heavy Nasdaq Composite recording its sixth consecutive positive session for the first time since January. The S&P 500 and the Dow Jones Industrial Average both rose for the sixth consecutive session, a phenomenon not seen since June and July.
Wall Street is examining whether last week’s rise is sustainable. Last Friday, all three indexes had their greatest week in 2023. The November rally contrasts sharply with a poor October in which the S&P 500 fell into correction territory. Investors seemed more bullish when the Federal Reserve kept interest rates constant following their meeting last week, which saw Treasury yields fall and equities rise.
European Markets
On Monday, European markets finished down as upward momentum from the previous week faded. The Stoxx 600 index fell 0.2 percent, although sector moves were moderate. Oil and gas stocks led the way higher, rising 0.8 percent.
Regional markets rallied for a week, fueled by a string of excellent profits and a perceived dovish lean from central banks. US equities were marginally higher on Monday as Wall Street sought to sustain its momentum following last week’s excellent performance, while most Asia-Pacific markets were encouraged by lackluster US employment data last week, which helped lower interest rate expectations. South Korean stocks rose on Monday as the nation reinstated its short-selling prohibition.
Asian Markets
South Korean equities slumped 2%, leading losses throughout the Asia-Pacific region ahead of Chinese trade data and the Reserve Bank of Australia’s rate announcement.
South Korea’s Kospi fell 2.17 percent, reversing Monday’s gains, when the index had its best performance since late March 2020 after the government reinstated a short-selling prohibition. The Kosdaq fell 1.03 percent.
The S&P/ASX 200 in Australia fell 0.22 percent ahead of the central bank’s rate decision. Reuters surveyed economists predict the central bank to boost its benchmark policy rate by 25 basis points to 4.35 percent. The Nikkei 225 fell 0.5 percent in the opening hour of trading in Japan, while the Topix fell 0.39 percent.
Futures on Hong Kong’s Hang Seng index are at 17,867, compared to the index’s recent closing of 17,966.59. China is anticipated to release November trade numbers.
In the United States, all three indices eked out modest gains overnight, adding to last week’s robust advance. The Nasdaq Composite rose 0.3 percent to 13,518.78, marking the longest bullish run since January. The S&P 500 rose 0.18 percent to 4,365.98, while the Dow Jones Industrial Average rose 34.54 points, or 0.1 percent, to 34,095.86.
Fitch Ratings increases India’s mid-term growth outlook to 6.2% while downgrading China.
On November 6, Fitch Ratings raised India’s medium-term growth projection by 70 basis points to 6.2 percent from 5.5 percent. The positive adjustment contrasts with the US credit rating agency’s fall in the estimate for ten emerging markets (EMs), mostly owing to China’s effect, which currently averages 4% on a GDP weighted-average basis. A basis point is equal to one-tenth of a percentage point.
“We have made significant upgrades to India and Mexico, with the latter benefiting from a significantly improved outlook for the capital-labor ratio.” “India’s estimate has increased from 5.5 percent to 6.2 percent, and Mexico’s estimate has increased from 1.4 percent to 2.0 percent,” the global ratings agency stated in a report issued on November 6.
Oil Prices
Oil prices rose on Monday as main producers Saudi Arabia and Russia announced more voluntary oil output curbs until the end of the year, keeping supply tight, while investors awaited stronger US penalties on Iranian oil.
Brent oil futures were up 41 cents, or 0.5 percent, to $85.30 a barrel, while US West Texas Intermediate crude was up 54 cents, or 0.7 percent, to $81.05 a barrel. Saudi Arabia said it will continue with its extra voluntary cut of 1 million barrels per day, or bpd, resulting in December output of roughly 9 million bpd, a source at the Ministry of Energy said in a statement.
Following the Saudi announcement, Moscow declared that it will maintain its further voluntary supply reduction of 300,000 bpd in crude oil and petroleum product exports until the end of December.
The Dollar Index
In futures trading, the Dollar index was 0.16 percent down at 104.90, while the value of one dollar was at Rs 83.22.
Gold Rates
Gold prices fell on Monday as US bond rates rose slightly ahead of a speech by Federal Reserve Chair Jerome Powell later this week, which will provide more clarity on the interest rate outlook.
After breaking beyond the $2,000 barrier on Friday, spot gold was down 0.4 percent at $1,983.49 per ounce by 0444 GMT. Gold futures in the United States declined 0.4 percent to $1,990.60.
“The major factor influencing gold in the near term will be US 10-year Treasury yields… if yields begin to resurgence, gold could break below the key support level around $1,974,” said Kelvin Wong, senior market strategist for Asia Pacific at OANDA.
The FIIs and DIIs
On November 6, foreign institutional investors sold shares worth Rs 549.37 crore, while domestic institutional investors purchased equities worth Rs 595.70 crore, according to preliminary data from the National Stock Exchange.
