Pre Market Report 18-Nov-2025

Pre-Market Report Summary

This report analyzes the market sentiment and potential movements for the day, considering recent global and domestic events.

1. Market Performance and Sentiment

• Previous Day's Optimism: The previous day saw a strong bullish sentiment, with Nifty closing above 26,000 for the second time this year and the volatility index declining. All sectors experienced buying pressure.
• Overnight US Market Decline: The US market experienced a significant fall overnight. The Dow Jones Industrial Average dropped for the third consecutive day. The US market exhibited high volatility, with intraday swings of 1% up and down multiple times, ultimately leading to a decline of nearly 2.5% from intraday highs to lows.
• Reasons for US Market Fall: The decline is attributed to upcoming economic data releases and the highly anticipated earnings report from Nvidia, a major technology company, scheduled for Wednesday after market hours.
• Impact on Gift Nifty: The optimism from the previous day has dissipated. Gift Nifty, which had crossed 26,100 earlier, indicating a potential opening near the year's intraday high, has now fallen, suggesting a lower opening for Nifty by 40-50 points.

2. Global Cues vs. Domestic Market Independence

• No One-to-One Correlation: The speaker emphasizes that domestic markets do not necessarily need to follow global cues. Just as India did not rise when the global market was rising, it is not obligated to fall when the global market is declining.
• FIIs Turn Net Buyers: A significant positive development is that Foreign Institutional Investors (FIIs) turned net buyers for the first time in the current November series. While the amount was not substantial, it marks a shift from previous selling pressure. This could potentially limit the downside.

3. Open Interest Analysis and Technical Levels

• 26,000 Call Option: Despite Nifty closing above 26,000, the open interest in the 26,000 call option showed no change. This suggests that those who had previously sold this option were not deterred and may have hedged their positions by selling the 26,000 put option to cover potential losses.
• Premium Analysis: As of yesterday's closing, the combined premium of the 26,000 call and put options was approximately 130 points.
• Projected Intraday Movement: Based on this analysis, Nifty is expected to move approximately 100-120 points up or down today.
• Crossing Year's High: If Nifty moves upwards, it has the potential to cross the year's high. However, the current sentiment does not strongly indicate this.
• Key Resistance Level: The 26,100 level is crucial. A double top has been formed at this level previously, and a decisive cross above it could signal stronger bullish momentum than observed in the past two attempts.
• Key Support Level: On the downside, 25,800 is considered a good immediate support. For the month, 25,500 is identified as a strong positional support.

4. Sector-Specific Observations

• IT Stocks: In the last two trading sessions, IT stocks fell in the morning but recovered towards the end of the day. This trend might continue today, with IT stocks potentially underperforming in the first half. The performance of IT stocks will be a key determinant of whether Nifty can reach 26,100.
• Bank Nifty: Bank Nifty has already touched an all-time high of 59,000. Typically, after touching an all-time high for the first time, some profit booking occurs, leading to a market fall. The real bullish momentum emerges when the market reverses and surpasses its previous high. A correction of 500-1000 points in Bank Nifty, followed by a recovery back to 59,000, would indicate stronger momentum.

5. Volatility and Event Considerations

• Weekly Expiry: Today is the weekly expiry, which usually leads to increased market volatility.
• IPO Listings: Two IPOs are listing today, with Physics Wallah being closely watched. Its subscription was not very strong, and its listing occurs on a day with potentially bearish global cues.
• US Futures Recovery: US futures are showing a slight recovery, though not significant. The US market has corrected over 6% from its recent highs, and the Indian market is performing relatively better.

6. Key Stocks to Watch

• HDFC Bank
• ICICI Bank
• Reliance Industries
• TCS
• Infosys

Key Concepts

• Nifty: A stock market index representing the weighted average of 50 of the largest Indian companies listed on the National Stock Exchange of India.
• Volatility Index (VIX): A measure of the market's expectation of volatility based on S&P 500 index options. A rising VIX indicates increasing fear and uncertainty.
• Gift Nifty: An index that represents the Nifty 50 index in a pre-market trading session, providing an early indication of the Indian market's opening.
• Dow Jones Industrial Average (Dow): A stock market index that represents 30 large, publicly owned companies traded on the New York Stock Exchange.
• FIIs (Foreign Institutional Investors): Institutional investors that are based outside of India and invest in Indian securities.
• Open Interest: The total number of outstanding derivative contracts (options or futures) that have not been settled.
• Call Option: A contract that gives the buyer the right, but not the obligation, to buy an underlying asset at a specified price on or before a certain date.
• Put Option: A contract that gives the buyer the right, but not the obligation, to sell an underlying asset at a specified price on or before a certain date.
• Premium: The price of an option contract.
• Double Top: A chart pattern that signals a potential reversal of an uptrend.
• All-Time High: The highest price an asset has ever reached.
• Profit Booking: The act of selling an asset to realize profits after its price has increased.
• IPO (Initial Public Offering): The first time a company offers its stock for sale to the public.
• Subscription: The process of applying for shares in an IPO.
• Listing: The process of a company's shares being admitted for trading on a stock exchange.