Indian Markets Extend Losses for Second Day; Nifty Drops Below 25,500 Amid Broad Sell-off; Pine Labs IPO Opens Friday

Indian equity markets continued their downward trend, marking a second consecutive session of losses. The benchmark Nifty 50 index closed 87 points lower at 25,509, exhibiting a pattern of lower highs and lower lows, and struggled to maintain the 25,500 level. The market opened marginally lower and, despite brief attempts at recovery, faced renewed selling pressure throughout the day.

Among the Nifty constituents, Asian Paints, Reliance Industries, and UltraTech Cement were notable gainers. Conversely, Grasim Industries, Hindalco Industries, and Adani Enterprises were among the top laggards. Sector-wise performance was mixed, with only the Nifty IT and Auto indices managing minor gains. Sectors like Media, Metal, and Consumer Durables bore the brunt of the selling. The broader market also underperformed, with the Nifty Midcap 100 and Nifty Smallcap 100 indices registering declines of 0.95% and 1.40%, respectively.

Adding to market activity, fintech major Pine Labs will launch its Initial Public Offering (IPO) on Friday. The ₹3,900 crore issue, which closes on November 11, has a price band of ₹210-221 per share, valuing the company at over ₹25,300 crore.

Technical analysts suggest the Nifty's trend remains weak. Nagaraj Shetti of HDFC Securities indicated that the index is approaching a crucial support zone around 25,400, with immediate resistance at 25,700. Nilesh Jain of Centrum Broking anticipates short-term weakness to persist, with selling pressure likely on pullbacks, and sees a need to cross 25,800 to negate the bearish setup, while 25,350 serves as immediate support. Rupak De of LKP Securities noted that the Nifty has retreated towards its support near 25,450, a break below which could further weaken the short-term trend. Nandish Shah of HDFC Securities highlighted the 25,400-25,450 zone as critical, warning that a decisive break could accelerate the downside.

The Bank Nifty also extended its decline for the second session. Sudeep Shah of SBI Securities pointed out that the 20-day EMA zone of 57,400-57,300 will act as immediate support, with a sustained move below 57,300 potentially leading to a correction towards 56,800. Resistance is seen around 57,900-58,000.

Impact This broad market decline signifies potential investor caution and might lead to increased volatility. The upcoming large IPO could attract liquidity, but its success might be tested against the prevailing weak sentiment. Technical indicators suggest that key support levels are being tested, and a breakdown could lead to further declines, impacting investor confidence and portfolio values. The market impact is rated at 5/10.

Difficult Terms - **Nifty**: A stock market index comprising the 50 largest and most liquid Indian companies listed on the National Stock Exchange. - **Lower highs and lower lows**: A technical chart pattern indicating a downtrend, where each subsequent price peak is lower than the previous one, and each trough is lower than the previous one. - **IPO (Initial Public Offering)**: The process by which a private company offers shares to the public for the first time. - **Anchor investors**: Large institutional investors who commit to purchasing a significant portion of an IPO before it opens to the general public, providing stability to the issue. - **Trendline resistance**: A technical analysis tool; a line drawn connecting a series of price peaks that suggests a level where upward price movement is likely to face selling pressure and stall. - **EMA (Exponential Moving Average)**: A type of moving average that gives more weight to recent price data, making it more responsive to current market trends. - **Swing high support**: A previous peak price level that may act as a floor for prices when they decline after reaching that peak. - **Bearish setup**: A technical configuration of chart patterns and indicators suggesting that the price of a security is likely to decline.