Indian markets will resume trading from today following a mid-week holiday and resumption comes after the escalation of geo-political tension in Middle East and some changes in derivatives trading rules by the SEBI. The GIFT nifty is down over 300 points and suggest a sharp gap down today.

Asian market mixed in the morning with NIKKEI Index up marginal 2.25% and Hang Sang down over 3%. However, the pullback in the Asian market is less likely to have major impact on India today as high valuation play.

FII has been net sellers since few sessions and sold around 5579 crore of equities on the first trading day of October while DII were net buyers.

On October 1, 2024, Iran launched 200 ballistic missiles at Israel in retaliation for the assassination of Hezbollah leader Hassan Nasrallah, prompting Israel to vow a decisive response. Global markets slide sharply during the overnight trading on Tuesday while Crude oil prices rose. The WTI crude oil prices at CME rose towards $72 mark on Tuesday and at the time of writing trading at $70.86 per barrel.

On Tuesday after the close of Indian market, the SEBI came with new guidelines for derivatives trading. As per the latest F&O rules, the derivative contract value cannot be less than Rs 15 lakh and per exchange there shall be only weekly expiry in indices. The measure shall be effective for all new index derivatives contracts introduced after November 20, 2024

Corporate and Economic Development

· Alembic Pharma gets final US FDA nod for Lamotrigine extended release tablets

Elililly expands manufacturing capacity with $4.5 billion investment in advanced drug development centre

·  Kalyani Strategic Systems and US-Based AM General & Mandus Group partner to Codevelop and Co-produce Next-Generation Artillery Platforms with Advanced Recoil Technology for Global Markets

·   Dr. Reddy's signs voluntary licensing agreement with Gilead Sciences to manufacture and commercialise Lenacapavir in India and other countries

·   Zydus Lifesciences gets USFDA nod to produce prostrate cancer drug

·   Mankind Pharma gets all regulatory approvals for acquisition of Bharat Serums and Vaccines

·   Chris Wood cuts India weight but retains ‘overweight’ stance. He also cut weightage on China as well.

Market Outlook

It is a general advisory to everyone, be careful in indices and stocks at this volatile situation. Indian market is prone to risk off sentiment due to higher valuations. Let the market settle down and provide clarity for longs. VIX may he high today’s trading.

NIFTY: The market may see sharp gap down today. The index may slide towards 25600-25500 levels or further if weakness continue. The resistance is seen at 25800 levels which is Tuesdays closing and also seen strong call writing at the strike. The crucial trendline support is at 25400-430 levels as of now and before the that 20 days EMA Support is seen at 25500-550 range.

BANK NIFTY: The bank nifty has failed to take support at 53300 and likely to break 52700 level and may test 51800 support levels. As long as it stays below 52700 trends shall be down.

NIFTY MIDCAP Select Index: The index has a strong support at 13160-180 and when it breaks we may see the index heading towards 13000-13050 levels. The intraday resistance is placed at 13200-230 levels.

The report is being prepared by Bitupan Majumdar, an independent SEBI registered research analyst with registration code INH30006962. Please consult your financial advisor before taking investment decision.