FIRST TRADE: Sensex sheds 181 points, Nifty at 23,110

Indian equities tracking mixed Asian markets opened lower despite record gains in the US markets in the overnight trade. At the start, Sensex declined 0.24 per cent or 181.4 points to 76,223.59, while the Nifty50 index was down 0.2 per cent or 45.5 points at 23,109.85.

Meanwhile, broader markets after a smart recovery in the previous day's trade were mixed, with Nifty Midcap 100 index trading higher, while the Nifty Smallcap 100 index was mildly down.

Sectorally, it was a sea of red with most indices in the red, however the IT pack continued to be resilient -last up by over 1 per cent.

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From the Nifty pack, top gainers included stocks like Wipro, UltraTech Cement, Tech Mahindra, Infosys and M&M, while top laggards were HUL, Nestle, SBI, L&T and Dr. Reddy's Lab.

Dr. V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services said, "There are two trends in the market that deserve attention. One, the institutional activity is showing a consistent trend - sustained selling by FIIs and sustained buying by DIIs. Two, there is a trend towards quality - largecaps are resilient while the broader market is weakening. These two trends are likely to continue in the near-term."

Since the dollar index and US bond yields continue to remain high FIIs are unlikely to turn buyers any time soon. This will cap a rally in the market even though the market is in an oversold zone, added Vijyakumar.

Expect heightened volatility in 2025 with upcoming events like the Federal Reserve meeting, the Union Budget, and Delhi Assembly elections, noted Prashanth Tapse, Senior VP (Research), Mehta Equities.

Key stocks to watch:

BPCL: Shares of the oil marketing company will draw focus after the company's better-than-expected Q3 earnings.

HUL: Shares of FMCG major will also be in focus post the company's largely in-line Q3 earnings.

Technical outlook

Vatsal Bhuva, Technical Analyst at LKP Securities said, "On Wednesday, Nifty took support near its previous session low of 22,980 and formed a hammer tweezer bottom candlestick on the daily chart, signaling potential recovery toward 23,350 levels after Tuesday's decline. However, sustained bullish momentum will only emerge if Nifty closes above 23,500, where the 21-day EMA is positioned. Until then, a cautious approach is advised. "

Short-term traders can focus on the 23,000–23,350 range, with 23,000 providing strong support and the 23,350–23,400 zone acting as a key resistance for the index, he added.

Asian markets

Most Asian stocks tracking gains in the US markets traded higher, with Japan's Nikkei rising higher before the Bank of Japan meeting. Also, Chinese shares drifted higher after the Chinese governmen outlined support for equities.