The market currently finds itself in a banks Vs IT battle. The currency weakness has emerged as a blessing in disguise for the battered and bruised IT sector, which is ensuring that the Nifty manages to sustain above key supports. Over the last two sessions, the Nifty IT index is up 6%, with largecap names like Infosys and Tech Mahindra gaining over 7% each, with TCS and HCLTech also chipping with a 3% and 4% gain of their own.
On the flip side are banks. The Nifty Bank is in the zone of extremes. It fell swiftly from record highs during the March sell-off, recovered equally faster if not more in April, and yet again is selling off this month, with no directional bias whatsoever. The index has declined in seven out of the last eight trading sessions and was also the key culprit behind the Nifty ending Tuesday’s weekly expiry session in the red.
Amidst all of this, the Nifty did cross its 50-DMA of 23,769 intraday, but despite multiple attempts, it could not sustain above those levels. That trading range from Tuesday, which was 23,587 to 23,782 will be the one which the bulls would look to break out from. Below 23,587, the index could look for support at the 23,500 mark.
Above 23,782, the index would want to first sustain above the 23,800 mark, before making an attempt to conquer the 20-DMA, which lies just above the mark of 24,000. Although it has multiple headwinds lying in the way, such as a weakening currency, high bond yields globally and rising oil prices, the market has not capitulated under pressure so far.
With earnings season entering its final stages, there are plenty of result reactions to be watched out for during mid-week trading. BEL’s management commentary will be key on their guidance for financial year 2027, along with BPCL, Zee Entertainment, Orkla India, PI Industries, Hatsun Agro and many others.
Apollo Hospitals and Grasim are the major names reporting results on Wednesday from the Nifty 50, but there are plenty of broader market stocks coming out with results. They include Lenskart, Sammaan Capital, Whirlpool India, JK Lakshmi Cement, IRB Infra, Epack Durables among others.
Key Levels To Watch
Rupak De of LKP Securities expects the overall sentiment to be tilted towards bears in the short-term and until 23,800 is not decisively crossed on the index, the sellers may regain control of the market at any point. On the downside, he sees support at 23,400, below which, the selling pressure could intensify.
“We continue to maintain a cautious stance on the index until it decisively reclaims the 24,000 mark, with immediate support placed in the 23,250 – 23,450 zone. Sectorally, traders are likely to continue finding opportunities on both sides of the market; therefore, the focus should remain on stock selection based on prevailing sectoral trends,” Ajit Mishra of Religare Broking said.
For the Nifty Bank, which traded in a 450-point range on Tuesday, the index will look to hold on to support levels at 53,000, while 54,000 on the upside continues to act as a barrier.
“On the downside, the 52,800 – 52,680 zone acts as the next support area. On the upside, the 53,800 – 54,200 zone becomes the immediate resistance band. The near-term outlook remains range-bound as long as the index continues to trade below all its major moving averages,” said Om Mehra of SAMCO Securities.
