Markets Opening Bell: SGX Nifty Signals Sensex, Nifty 50 May Open Flat; RBI's Policy Rates Decision In Focus

Indian market is likely to open between flat to green on Tuesday as the Reserve Bank of India (RBI) will begin its 3-day monetary policy meeting today. In the early deals, SGX Nifty index traded flat, while Asian shares opened higher tracking a robust gain in Wall Street overnight. In the previous session, Sensex and Nifty 50 gained despite mixed global cues driven by pharma and IT stocks.

The SGX Nifty, which is the futures contract of Nifty index traded on the Singapore exchange, traded at 19,677, down by 4.5 points or 0.02% at 6.45 am on Monday. The index ranged between 19,689.5 to 19,596.0 levels after opening at 19,675.

However, Asian stocks traded higher after Wall Street rallied overnight as investors' focus has now shifted toward the upcoming release of the July CPI inflation report later in the week. Japan's Nikkei gained by nearly 1%, South Korea's KOSPI was up 0.6%, and Australian shares edged higher as well. ASX 200 futures were up as well.

On the contrary, S&P 500 and Nasdaq futures traded in the red with a marginal 0.09% and 0.14% drop. In commodities, Brent crude lost some steam with a drop of 0.7%, meanwhile, spot gold inched lower by 0.3% to $1,93685 per ounce. In the case of bond markets, the US 10-year treasury yield stood at 4.082%.

On Monday, Indian markets saw modest gains led by broad-based buying with healthcare and IT stocks driving the performance. Midcap stocks also outperformed. Sensex ended at 65,953.48, up by 232.23 points or 0.35%, while Nifty 50 finished at 19,597.30 higher by 80.30 points or 0.41%. BSE Midcap stocks climbed by 168.36 points, while Smallcap index picked up by 91.41 points. In terms of sectoral indices, BSE Healthcare stocks zoomed by 448 points, while the IT index advanced by 328.51 points, however, Bank Nifty dipped by 42 points to end at 44,837.50.

Meanwhile, foreign institutional investors (FIIs) continued to be net sellers with an outflow of Rs 1,892.77 crore in Indian stocks, on the contrary, domestic institutional investors (DIIs) have emerged as net buyers with an inflow of Rs 1,080.80 crore during August 7th trade.

Wall Street halted its weekly losses on Monday ahead of the inflation report on Thursday. Dow Jones Industrial Average surged by 1.2%, S&P 500 index zoomed by 0.90% and the tech-heavy Nasdaq picked up by 0.61%.

For Tuesday's trade, Ajit Mishra, SVP - Technical Research, Religare Broking said, "On the benchmark front, Nifty has an immediate hurdle at 19650 and a decisive break could add more legs to the rebound else profit taking would resume so plan your trades accordingly."

Among key June quarter earnings to watch on Tuesday are -- Adani Ports, Coal India, Jet Airways, Oil India, Religare Enterprises, and others.

While Rupak De, Senior Technical analyst at LKP Securities said, "The Nifty index demonstrated resilience as it predominantly remained strong, reclaiming its position above the 21-day Exponential Moving Average (21EMA) after a brief dip below this critical average. Going forward, the level of 19500 is expected to serve as immediate crucial support. The market's upward momentum is likely to persist as long as the Nifty maintains its position above this support level. On the upper end, potential resistance can be anticipated around the range of 19700 to 19750."

Further, on Bank Nifty, Kunal Shah, Senior Technical and derivative analyst at LKP Securities said, "The Bank Nifty index is currently in a consolidation phase, with a visible support level at 44500 and a resistance level at 45100. Traders should consider utilizing opportunities presented within this range to establish positions according to their respective strategies. A clear directional move is anticipated only after a decisive breakout on either side of this range, as this would potentially indicate a stronger and more sustainable trend."

RBI's 3-day policy meeting is set to begin on August 8 and the outcome will be announced on August 10. RBI is expected to keep the repo rate unchanged at 6.5% in this policy.

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