Global Cues Remain Unfavourable
Investor confidence remains shaken amid escalating tensions in the Middle East. Oil prices have surged sharply following renewed attacks in the region and concerns over shipping disruptions through the Strait of Hormuz. The spike in crude has triggered fears of fresh inflationary pressures globally.
US markets witnessed volatility overnight. Although early losses were trimmed after assurances of measures to secure shipping routes, sentiment remained cautious. Asian markets followed suit, trading lower for the third consecutive session.
Market participants are now recalibrating expectations around US Federal Reserve rate cuts as higher energy prices could complicate inflation dynamics.
Commodity Watch: Oil and Gold in Focus
Crude oil extended its rally, with Brent hovering near multi-month highs while US West Texas Intermediate also remained elevated. The surge marks one of the strongest short-term gains in recent years.
Gold prices, after witnessing a sharp correction earlier this week, rebounded as investors sought safe-haven assets. A firm US dollar and rising bond yields, however, continue to cap gains in precious metals.
Broader Markets Under Pressure
The weakness was not limited to frontline indices. Midcap and smallcap stocks also saw notable declines, reflecting risk aversion among investors. Analysts caution that volatility may remain elevated in the near term.
Technical indicators suggest immediate resistance for Nifty near the 25,000 mark, while support is seen around the 24,000 zone. Traders are advised to remain cautious and adopt strict stop-loss strategies.
Stocks to Watch Today
Several companies are likely to remain in focus based on corporate developments:
- LIC extended the tenure of its Chief Financial Officer.
- Adani Ports reported healthy year-on-year cargo growth in February.
- SBI saw changes in senior management following completion of a deputy MD’s tenure.
- RailTel will consider a dividend proposal later this week.
- UltraTech Cement announced plans related to investment and upcoming quarterly results.
- Cipla incorporated a new overseas arm and formed a joint venture for biologics manufacturing.
Additionally, select counters will see action due to bulk deals, insider transactions, and price band revisions.
F&O and Derivatives Setup
In the derivatives segment, Nifty futures indicated continued weakness in early trade. Options data suggests significant open interest at the 26,000 call strike and 24,000 put strike, making these crucial levels for traders.
Outlook for the Day
Market direction will largely depend on global developments, especially crude oil movement and updates from the Middle East. Domestic investors will also track foreign institutional investor flows and currency trends.
Given heightened volatility, experts recommend a balanced approach avoid aggressive leveraged positions and focus on fundamentally strong stocks during corrections.
