Closing Bell: Nifty ends below 18,000, Sensex falls 433 pts dragged by auto, metals

Index closed a week at 17746 with loss of nearly two percent and formed a bearish candle on weekly chart hinting weakness in the markets. Now next good support for the market is coming near 17600 zone if managed to hold above-said levels one can expect a good pull back in the index again towards 18k mark but if failed to hold then we may see more drag down in Nifty towards 17300-17000 mark. The immediate hurdle is coming near 17830-17940 zone where one can again lock their gains in longs.

The bears continued to dominate and dragged the index lower as weak global cues impacted sentiment. Besides, the subdued listing of Paytm added to the pressure as the session progressed. The scheduled weekly expiry further added to the volatility. Finally, the Nifty index ended lower by 0.7% to close at 17,764. The broader markets also witnessed selling pressure and lost over one percent each. Amongst the sectors, auto, metal and IT were the top losers.

We reiterate our cautious view on the markets, given the feeble global cues. Besides, the charts are also indicating the prevailing corrective move to extend further, with immediate support at 17,500 or lower in Nifty. In case of a rebound, the 17,900-18,000 zone would act as a resistance. Considering the scenario, traders should limit leveraged positions and maintain a few shorts also.

Market sentiment remained weak for the third straight session as factors such as rising inflation numbers and higher valuations are weighing on investors' minds, resulting in a correction in key indices.

On weekly charts, the Nifty has formed a strong bearish candle which is largely negative. In addition, the index has broken the important support level of 17800 and closed below the same.

For the traders, 17950 would be the immediate hurdle. If the index rises above the level, a pull-back momentum can continue up to 18025-18150-18200 levels. On the flip side, trading below the 50 days SMA or 17900, the index could slip up to 17600-17500 levels. Contra traders can take a long bet near 17500 with a strict support stop loss at 17425.

Meanwhile, after a long time, the Bank Nifty traded below the 50 day SMA which is broadly negative. The texture suggests 38500 and 39000 could act as important resistance levels in the short run.

On the technical front 17,700 and 18,000 are near term support and resistance in Nifty 50 and for Bank Nifty, 37,680 may act as immediate support while 38,396 is seen as resistance level.

On the weekly expiry day, the index opened on a negative note and traded with negative bias throughout the sessions, and closed the session at 17764.80 levels with a loss of 133 points. While Bank Nifty closed the session at 37976.25 level with a loss of 65.30 points. On the sectoral front, all closed on a red note while the Nifty Auto and Metal were the top losers.

Technically, the index has given a breakdown of the rising trend line & given closing below 50 DMA, which suggests weakness for the next trading sessions. From the last four trading sessions, the index has been trading with lower highs & lower lows, which points out some corrections for the next trading session.

However, the Index has taken support from the lower band of Bollinger, breaching below can show further downside. Furthermore, the index has given closing below 21 DMA as well as the Stochastic & MACD indicator is trading negative crossover, which points to weakness in the counter for the next trading sessions. At present, the index has a support level of 17650, while resistance is at 18000 levels.

Weak listing of India’s largest IPO and soft global market amid rising inflation woes impacted domestic sentiment. In the context of a weak global market, contraction extended in metal and crude oil prices weighing down the Indian market.

The auto sector was also under pressure as the industry reported weak festive sales numbers owing to poor demand for two-wheelers and supply shortage in semiconductors.

The markets bounced swiftly from around the 17600 level as that is the lower end of the current range and the short-term support for the Nifty.

If we break that level, the short-term trend will turn down and the bears will take over. That could take the markets down to 17200.

On the upside the resistance is at 18150 and until we do not get past that, the current range-bound movement will continue.

Benchmark indices ended lower for the third consecutive session on November 18, with selling seen auto, metal, IT, pharma, realty names.

At close, the Sensex was down 433.05 points or 0.72% at 59,575.28, and the Nifty was down 133.90 points or 0.75% at 17,764.80. About 997 shares have advanced, 2252 shares declined, and 133 shares are unchanged.

SBI, Power Grid Corp, HDFC Bank, IOC and Divis Labs were among major gainers on the Nifty, while losers were Tata Motors, Tech Mahindra, M&M, HCL Technologies and L&T.

All the sectors ended in the red with auto and metal indices lost over 2 percent each. The BSE midcap and smallcap indices fell 1.5 percent each.

The public issue of Go Fashion, which sells women's bottom-wear under brand Go Colors, has received good response from investors with 5.39 times subscription on November 18, the second day of bidding.

Investors have put in bids for 4.35 crore equity shares against the offer size of 80.79 lakh equity shares, as per the subscription data.

Retail investors have been active from the day one of bidding, buying shares 22.27 times their reserved portion, while the part set aside for non-institutional investors is subscribed 1.77 times so far and that of qualified institutional buyers has seen 1.57 times subscription.

The dollar slipped back from a 16-month peak on Thursday, losing ground on the euro and Australian and New Zealand dollars as traders assessed whether the U.S. currency's recent surge was starting to stall.

The dollar has rallied in recent weeks as traders bet on tighter U.S. monetary policy. Stronger-than-expected inflation numbers in the United States last month and punchy retail sales data this week have added to those bets.

And while volatility in FX markets remains low, it is markets' assessment of global central banks' differing responses to rising inflation that is driving currencies.

Paytm operator One 97 Communications share price fell more than 20 percent intraday after a debut with discount.

The share had a moderate listing on the bourses on November 18 as it fell 9 percent on debut.

The stock opened at Rs 1,950 on the National Stock Exchange and the listing price on the BSE was Rs 1,955, against issue price of Rs 2,150.

One 97 Communications was quoting at Rs 1,564.00, down Rs 586.00, or 27.26 percent.

Foreign broking firm JPMorgan has kept overweight call on Vedanta with a target at Rs 400 per share.

If the company demerges businesses into separate listed entities, there may be 4 listed companies, however most likely, it could be a de-merger with mirror shareholding of the existing company, it added.

Vedanta was quoting at Rs 308.85, down Rs 29.55, or 8.73 percent.

Oil prices slid to six-week lows on Thursday as China said it was moving to release strategic reserves after a Reuters report that the United States was asking large consuming nations to consider a coordinated stockpile release to lower prices.

The bid by the U.S. to shock markets, asking China to join a coordinated action for the first time, comes as inflationary pressures, partly driven by surging energy prices, start to produce a political backlash, as the world fitfully recovers from the worst health crisis in a century.

Brent crude was down 83 cents, or 1%, to $79.87 a barrel by 0749 GMT, after earlier dropping to $79.28, the lowest since Oct. 7.