Opening Bell: Here’s what you need to know before the market opens on October 12, 2021.

SGX Nifty indicates markets to open in red, but the big question should you ‘buy the dip’?

The Indian stock market is scaling new trading peaks every session, and Monday was no different as benchmark indices Sensex and Nifty closed at record highs. While Nifty breached the 18000 mark on an intraday basis, Sensex was hovering above the 60000 level at the closing bell.

In the last trading session, the Nifty index logged its highest daily closing, while the broader markets cheered as they outperformed the frontline indices. As a result, market participants would be expecting the bulls to continue their northward journey for the third straight day! However, as per the early indication, Nifty is likely to waver in early morning action as SGX Nifty is down by 86 points and was seen trading at 17,875 levels. The blame of changing sentiment on D-Street is due to melancholy cues from the global markets. However, the million-dollar question is should one buy this dip or not? We believe as long as the index trades above its crucial support of 17,830-17,840 one can buy the dip. 

Cues from Asian markets: The Asian markets were seen trading in red on Tuesday amid disappointing cues from Wall Street in overnight trade. Hong Kong’s Hang Seng was down by 0.97% followed by Japan’s Nikkei 225 which has slipped 0.79% and China’s Shanghai Composite that dropped by 0.52%.

Overnight cues from US markets: All the three major US stocks indices ended Monday's trading session in negative terrain and near to their worst level of the day. The Dow and the S&P lost nearly 0.7%, while the tech-heavy Nasdaq dropped 0.6%. Interestingly, the US 10-year bond yield went past 1.6%, which is the highest level since June.

Last session summary: On Monday, Indian benchmark indices started off the session on a tepid note, however, soon bulls gathered momentum and they not only recouped entire losses but went on to score in a big way. Nifty for the first time crossed its important psychological level of 18,000 and touched a high of 18,041.95. However, in the latter part of the trading session profit booking emerged, and as a result, Nifty trimmed its gains and settled up by 0.28%. The broader markets outperformed with Nifty Midcap 100 and Smallcap 100 rising by 0.61% and 1.16%, respectively.

Among sectoral indices, barring Nifty IT all other sectoral indices witnessed buying interest. Auto was the top gainer.

FII’s and DII’s activity on Monday: FIIs and DIIs were net sellers to the tune of Rs 1,303.22 crore and Rs 373.28 crore, respectively.

Important events to watch out for the day: On the earning front, GM Breweries and BEPL will be in focus. Also, market participants would keenly watch the release of the September CPI Inflation and August industrial output data.