The Indian stock market recovered part of the previous day’s sell-off in Wednesday’s trade on 16 September, as a drop in crude oil prices and global bond yields supported sentiment. In addition, renewed buying in banking, FMCG, and automobile counters offered support to the frontline indices.
However, the buying remained limited as investors awaited the US Federal Reserve’s policy announcement later in the day, with the market largely pricing in a rate hike amid soaring energy costs and strong employment data.
Indian stock market today
Both the Nifty 50 and Sensex closed Wednesday’s session with gains of over 0.40% each. The broader markets, however, remained mixed, with the Nifty Midcap 100 finishing flat, while the Nifty Smallcap 100 index declined 0.18%.
Sectoral performance was mixed, with FMCG, PSU banks, realty, media, , and oil and gas stocks all closing higher. On the flip side, technology stocks were the biggest laggards as investors booked profits following their recent run-up. Pharma and chemical stocks closed with mild losses.
Vinod Nair, Head of Research at Geojit Investments Limited, said Indian equities advanced in tandem with regional markets as easing crude oil prices and a largely priced-in U.S. Fed rate hike improved investor sentiment. He said the constructive mood was further reinforced by a moderation in Japanese bond yields ahead of the BoJ’s policy decision, supporting risk appetite across Asia.
Domestically, Nair said large-cap stocks led the gains, driven by strength in banking, FMCG, and automobile counters, while the IT sector witnessed selective profit booking following its recent outperformance.
Looking ahead, Nair said investors now await the Fed Chair’s commentary for deeper insight into the future rate trajectory. “The guidance is expected to influence global liquidity conditions, capital flows, and the near-term direction of financial markets,” he said.
What levels could trigger Nifty’s next move?
Rupak De, senior technical analyst at LKP Securities, said the index remained sideways as traders stayed on the sidelines ahead of the Fed rate decision and forward guidance. “On the higher end, 23,300 acted as resistance, while the index found support above the previous low,” De said.
De noted that the RSI is in the deep oversold zone, although this alone does not signal a recovery. “The RSI is in the deep oversold zone; however, this does not automatically signal a recovery, though a potential recovery may be around the corner,” he said. A decisive move above 23,300 might lead to a recovery towards 23,500 and higher, while “on the lower end, the downside may resume below 23,200,” De added.
Vipin Kumar, AVP-Research at Capital Market, said the benchmark Nifty index traded sideways for most of the session ahead of the FOMC outcome on interest rates. “The current chart structure and elevated crude oil prices indicate the possibility of a further downside move in the near term,” Kumar said.
According to Kumar, immediate price support lies around the 23,000–23,100 spot zone. “A decisive close below this zone could push it toward 22,500 or lower in the immediate near term. Any bounce back toward the 23,450–23,600 spot zone will attract renewed sellers’ interest,” he said.
Can Asian markets hold gains as key indices approach resistance?
In Asia, Japan’s benchmark Nikkei 225 surged 0.69% to close at 63,923. South Korea’s Kospi also advanced 1.37% to 6,717.97. Hong Kong’s Hang Seng rebounded modestly by 0.20% to 24,713.78, while the Shanghai Composite jumped 0.7% to 3,891.60. Australia’s S&P/ASX 200 was up 0.3% at 8,696.50.
On the near-term outlook, Kumar said the Nikkei index has been hovering around its 6-month-long exponential moving average at the 62,950 spot level for the past four trading sessions.
“A decisive move beyond the 64,120 spot level could lead the index toward 64,950–65,150. Downside support is placed around the 62,700–62,950 spot zone,” he said.
Kumar also pointed to a narrow trading range in the KOSPI index. “In line with its Asian peers, the KOSPI index has also been hovering in a narrow range (6,582–6,775) for the past three trading sessions. A breakout on either side of this range will trigger the next short-term swing move of around 200 points in that direction,” he said.
Meanwhile, the Dow Jones Industrial Average is gradually moving toward price support around the 51,500-spot level. “Immediate resistance lies around the 52,750-spot level,” he added.
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