Nifty Weakens Below Key Average Amid Mixed Sectoral Market Trends

Index Update: The Nifty 50 Index closed near 24,090.85, slipping below its 50-day SMA of 24,208.04 and indicating some deterioration in the recent technical setup. Price action has weakened over the past few sessions, with the index now trading around the medium-term moving average. The 14-day RSI stood at 43.47, showing that momentum has shifted into a softer zone. Key levels to monitor are 23,970.00 and 23,850.00 on the downside, while 24,330.00 and 24,450.00 remain relevant on the upside. A move beyond this range could provide further clarity on the next directional move.

Macro Update: Softer US sanctions on Iran eased inflation concerns, pushing domestic bond yields lower and supporting financial stocks. Metal shares gained on improving realisation prospects. Meanwhile, IT stocks declined after the US paused visa appointments amid an immigration crackdown, raising concerns over higher operating costs and margin pressure.

Top Market Movers: On Thursday, Adani Enterprises Limited (NSE: ADANIENT) led the gainers with a 1.83% increase, closing at INR 3,169.00 followed by Kotak Mahindra Bank Limited (NSE: KOTAKBANK) up 1.80% at INR 424.20 Adani Ports and Special Economic Zone Limited (NSE: ADANIPORTS) which rose 1.33% to INR 1,714.00. On the downside followed Hindalco Industries Limited (NSE: HINDALCO) saw the largest drop, falling 2.75% to INR 1,024.00 followed HDFC Bank Limited (NSE: HDFCBANK) down 2.23% to INR 711.00 and Mahindra & Mahindra Limited (NSE: M&M) which dropped 2.01% to INR 3,330.00.

Commodity Update: The dollar held near an eight-day high as stronger U.S. inflation and economic data raised expectations of a Federal Reserve rate hike ahead of the Jackson Hole symposium. Gold gained 0.72% to USD 4,687.20, while silver surged 1.83% to USD 69.27. Copper advanced 0.42% to USD 14,315.50. Brent crude fell 0.70% to USD 87.24, extending its decline amid expectations that Iran-Qatar talks could help reopen the Strait of Hormuz and ease Middle East supply disruptions.

Our Stance: The near-term stance remains cautiously bearish as the Nifty 50 trades below its 50-day SMA and momentum indicators have weakened. Support at 23,970.00 and 23,850.00 will be crucial, while a sustained move above 24,330.00 could improve sentiment. Sector-specific developments may continue driving volatility.

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