Market Outlook for 4 October 2023

Post the extended weekend, our markets started on a negative due to weak global cues. Post the first hour sell-off, the Nifty index traded within a narrow range throughout the day and it ultimately ended above 19500 with a loss of over half a percent.

Nifty Today:

It's been almost a couple of weeks since our markets entered a corrective phase when Nifty breached the 20000 mark. The global factors such as rising US bond yields and rising dollar index has resulted in some selling pressure in the equity markets and our indices too have been moving in tandem with the global markets. FII’s have been selling equities in the cash segment since last couple of months, but recently they also have formed short positions in the index futures which have mainly led to the correction in our markets. Their long short ratio (as on Monday) was just around 28 percent, which means that about 72 percent of the positions are on the short side. Thus, the data remains bearish as of now and hence we are witnessing selling pressure on the index in intraday pullbacks. So until the data changes or the index surpasses its important short term hurdles, it's better to be cautious and trade with limited exposure. The Midcap 100 index is still trading above its 20 DEMA support and hence, stock specific outperformance from the broader markets could continue.

Weak global cues resulting in continued selling pressure

The important near term supports for Nifty are placed around 19460 and 19360 while resistances are seen around 19640 and 19760.  

Nifty, Bank Nifty Levels and  FINNIFTY Levels: