Sensex, Nifty Likely To Open Flat Tracking Global Shares, Elevated Treasury Yields; 3 Stocks To Buy Today

Indian market is likely to open on a muted note on Tuesday amidst elevated treasury yields. In the early hours, Gift Nifty traded on a flat note, hinting at a flat start for Sensex and Nifty 50, on the other hand, the Asian counterpart traded higher tracking upside in Wall Street overnight. In the previous session, Sensex and Nifty 50 ended on a positive note owing to a rebound in global cues and sharp buying in tech stocks.

Gift Nifty, formerly known as SGX Nifty, traded at 19,392.5, up by 4 points or 0.02% at 8.01 am on Tuesday. The index opened at 19,388.5 and traded in the range of 19,399.5 to 19,379 respectively.

Meanwhile, in the early Asian hours, stocks traded up as a robust rally in tech stocks lifted performance in Wall Street, however, elevated yields are likely to keep the markets mood volatile. Japan's Nikkei 225 traded up by 0.6%, South Korea's KOSPI index was up 0.4%, while Australian index ASX 200 traded marginally up. Hong Kong's Hang Seng index was currently the top performer with over 0.7% upside, and China's mainboard Shanghai Composite index also picked up momentum.

However, US stock futures slipped in the Asian market after the S&P 500 Index snapped a four-day losing streak on Monday.

According to data compiled by Bloomberg, the Nasdaq 100 Index rose about 1.7%, with Tesla Inc. up the most since March. Nvidia Corp. jumped over 8% ahead of the chipmaker's results due Wednesday, which is expected to show a 65% rise in revenue.

Overnight, Wall Street broadly gained driven by tech heavyweights. The Dow Jones Industrial Average index ended slightly lower, while the S&P 500 index settled higher by 0.7%. The Nasdaq Composite Index emerged as the top gainer by ending with a 1.6% upside.

As per Reuters, the yield on 10-year Treasury notes hit highs last seen during the Great Financial Crisis in 2007 as investors looked warily toward a meeting of central bankers who convene on Thursday at Jackson Hole in Wyoming. Federal Reserve Chair Jerome Powell is due to speak on Friday.

At home, on Monday, Sensex ended at 65,216.09, up by 267.43 points or 0.41%, while Nifty 50 was up by 83.45 points or 0.43% to end at 19,393.60. BSE Midcap and Smallcap index outperformed by advancing 263.08 points and 252.06 points respectively. All sectoral indices were in the green with IT, banking, capital goods, consumer durables, and metal stocks among the top contributors.

On August 21 trading performance, Vinod Nair, Head of Research at Geojit Financial Services said, "A rebound in the global market after a significant correction prompted buying in domestic equities, particularly within the IT sector. However, the potential for volatility to linger in the near term remains due to the increasing dollar index and elevated US bond yields, fuelled by concerns about rate hikes. Investors are keenly observing the commentary from the Fed chair during its forthcoming summer conference for interest rate insights. Meanwhile, Asian markets displayed a mixed performance, reacting to the smaller-than-anticipated rate cut initiated by the Chinese central bank."

Tuesday's Trade Guide:

Vaishali Parekh, Vice President - Technical Research, Prabhudas Lilladher expects the Nifty Spot Index to find support around 19,300/19,250 during Thursday's trade, while resistance is seen at 19,550/19,600. Further, the Bank Nifty spot index is likely to find support in the range of 43,700/43,650 and resistance is seen between 44,500/44,550.

Intraday Stock Picks:

Parekh has recommended 3 stocks to buy on Thursday:

- Buy BHEL at Rs 101 with a stoploss of Rs 99 for a target 107

- Buy RITES at Rs 473 with a stop loss of Rs 468 for a target 500

- Buy CIE Automotive India at Rs 500.50 with a stop loss of Rs 494 for a target of 525

Also, Ajit Mishra, SVP - Technical Research, Religare Broking said, "Participants shouldn't read much into intermediate rebound or a pause until Nifty decisively reclaims 19650 levels or forms a reversal pattern. And, we recommend continuing with a stock-specific trading approach and maintaining a focus on risk management."

Disclaimer:

The recommendations made above are by market analysts and are not advised by either the author nor Greynium Information Technologies. The author, nor the brokerage firm nor Greynium would be liable for any losses caused as a result of decisions based on this write-up. Goodreturns.in advises users to consult with certified experts before making any investment decision.