On Thursday, the Nifty 50 fell 0.11% to 23,532, closing below its 200-day moving average for the first time since April 2023. The BSE Sensex shed 0.14%, ending at 77,580. Markets were closed on Friday for Guru Nanak Jayanti.
1. Maharashtra Election
Investors may remain cautious ahead of the Maharashtra elections due to potential political uncertainties. As Maharashtra is both an economic powerhouse and a major political battleground, the election outcome could influence policy decisions and investor sentiment, particularly in sectors that are directly impacted by government actions.
The Indian stock market will remain closed on Wednesday, November 20, in observance of the Maharashtra Assembly elections. Results for the Maharashtra and Jharkhand Assembly elections are expected to be announced on Saturday, November 23.
2. FIIs Activity
Foreign Portfolio Investors (FPIs) have maintained their bearish stance on Indian markets in November, extending their massive selloff from October. According to NSDL data, they have already pulled out Rs 22,420 crore in the first half of November, following a staggering Rs 1,13,858 crore outflow in October.
Adding to the concern, FPIs have also turned cautious on Indian debt markets, with outflows reaching Rs 4,717 crore in the first fortnight of November.“The relentless FPI selling has been triggered by the cumulative impact of three factors: first, high valuations in India; second, concerns regarding earnings downgrades; and third, the Trump trade,” said Dr. V.K. Vijayakumar, Chief Investment Strategist at Geojit Financial Services.The persistent FPI outflows could pose challenges for Indian markets in the near term, as foreign investors continue to realign their portfolios based on both global and domestic factors.
“Given the volatility and FII selling pressure, investors may adopt a cautious stance, with many likely awaiting signs of stabilization before increasing exposure to large-cap stocks, especially in sectors affected by FII sell-offs,” said Pravesh Gour, Senior Technical Analyst at Swastika Investmart.
3. Rising bond yield and stronger Dollar index
The rise in U.S. Treasury bond yields, with the 10-year yield reaching 4.44% and the 2-year yield at 4.3%, along with a stronger dollar, may add pressure on Indian equities in the upcoming week. The dollar index is currently at 106.68.
Higher bond yields make U.S. assets more attractive, leading to capital outflows from emerging markets like India. Additionally, a stronger dollar increases the cost of foreign capital, discouraging investment and further weighing down market sentiment.
“High U.S. bond yields and a strengthening dollar post-election have impacted emerging markets like India, and FII activity remains a key factor influencing Indian equities in the near term,” said Pravesh Gour, Senior Technical Analyst at Swastika Investmart.
4. New IPOs and Listings to Watch on D-Street
In the mainboard segment, the NTPC Green Energy IPO is set to open for subscription on November 19, while the Zinka Logistics Solution IPO will close for bidding on November 18. In the SME segment, two new issues are scheduled to open for bidding this week.
On the listings front, shares of Zinka Logistics Solution will debut on both the BSE and NSE, while three SMEs will list their shares on the BSE SME or NSE SME platforms.
5. Crude Oil
International crude oil prices fell by more than two percent in the previous session as investors grew concerned about weaker Chinese oil demand and the potential slowing of U.S. Federal Reserve interest rate cuts following the latest macroeconomic data.
Brent crude futures settled down $1.52, or 2.09%, at $71.04 a barrel. U.S. West Texas Intermediate (WTI) crude futures settled down $1.68, or 2.45%, at $67.02. For the week, Brent fell 3.8%, while WTI declined 4.86%.
6. Corporate Action
Several major companies, including ONGC, Asian Paints, MRF, Ashok Leyland, Cochin Shipyard, Info Edge, REC Ltd, and Procter & Gamble Hygiene and Health Care, will begin trading ex-dividend starting Monday.
7. Technical View
“Nifty has reached its 200-DMA, with key support at 23,338. A bounce-back is likely from the 23,500-23,338 zone. On the upside, 23,800 serves as immediate resistance, with the next hurdle at 24,200. On the downside, if it slips below 23,300, the next important support will be at 22,800,” said Pravesh Gour.
Rupak De of LKP Securities said, “On Thursday, Nifty closed near its 200-day EMA, forming a gravestone doji-like pattern on the daily chart, signaling bearish sentiment. This suggests a ‘sell on rise’ approach as the index hovers in an oversold zone near a key EMA level. A bounce is likely, but it should be seen as an opportunity to sell. If Nifty breaks below the 200-day EMA, selling pressure could intensify. The index has support at 23,450, with resistance expected at 23,650, framing the short-term trading range.”
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)
