Led by banking and midcap stocks, markets dived as the Interim Budget announcements disappointed expectations. The Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) combined advance decline ratio was negative at 1012:2559. The turnover was lower as the weakness kept retail participation at bay.
Indices have closed in the lower end of the intraday range, amidst negative market internals. The 3015-2890 range specified for Monday was violated on the downside as the Nifty closed below the lower threshold. The bears were emboldened by the Nifty spot which remained below the 2915 bearish threshold.
The coming session is likely to witness a range of 2920 on advances and 2770 on declines. The bullish pivot will be the 2900 level and the bearish pivot will be the 2875 level.
The market internals indicate a lower turnover due to the weakness. The number of trades were higher and the average ticket size per trade was lower, indicating a weak buying bias. The capitalisation of the market was lower in line with a downtick session.
The outlook for the market on Tuesday is likely to be that of caution as the bulls are at a disadvantage. Unless the Nifty trades above the 2900-2925 band consistently, avoid fresh longs.