SENTIMENT INDICATORS

This indicator measures the percentage of Nifty 50 stocks that are trading above/below their 200-day simple moving averages[EasyDNNnews:PaidContentStart]

200-DMA INDICATOR

The 200-day moving average setup weakened sharply between September 23, 2026, and September 30, 2026, reflecting deterioration in market breadth amid continued pressure in benchmark indices. The percentage of Nifty 50 stocks trading above their 200-DMA declined from 28 per cent to just 8 per cent, while the proportion of stocks trading below this key long-term average increased from 72 per cent to 92 per cent. The decline in breadth coincided with a 2.75 per cent fall in the Nifty during the period, indicating that selling pressure spread across a wider section of Large-Cap stocks. With only a handful of constituents sustaining above their long-term averages, the broader market structure remains weak. At the stock level, Dr Reddy’s Laboratories emerged as the only Nifty 50 constituent to move above its 200-DMA during the period, highlighting limited pockets of relative strength. On the other hand, several major stocks slipped below their respective 200-DMAs, including Apollo Hospitals, Bajaj Auto, Bajaj Finance, Grasim Industries, HCL Technologies, HDFC Life Insurance, InterGlobe Aviation, JSW Steel, Max Healthcare Institute, Tech Mahindra and Titan Company. The higher number of negative crossovers compared with positive movements reflects renewed selling pressure across multiple sectors. Overall, the latest reading points to a significant deterioration in the Nifty 50’s longterm breadth profile, reversing the improvement seen in the previous week. The fall in stocks trading above the 200-DMA to single digits suggests that market participation has weakened considerably, with most index constituents now trading below their long-term trend indicators. For the breadth structure to improve, a larger number of stocks will need to reclaim and sustain above their 200-DMAs in the coming sessions.

SECTORAL SENTIMENT INDICATOR

The sectoral 200-DMA breadth as of September 30, 2026, reflected a sharp deterioration in market participation, with most major sectors witnessing a decline in the percentage of stocks trading above their longterm moving averages. The weakness was widespread across financial services, IT, auto, realty and FMCG segments, indicating that selling pressure extended across multiple pockets of the market. While defensive sectors such as pharma and media continued to show relatively stronger breadth, the overall sectoral structure remained weak due to declining participation across key sectors. Among the major sectoral indices, Nifty Pharma remained the strongest segment, with 70 per cent of its constituents trading above the 200-DMA, unchanged during the period. Nifty Media also maintained relatively healthy breadth, with 50 per cent of stocks holding above their long-term averages. Nifty Metal and Nifty Realty had 40 per cent of constituents above the 200-DMA, although both witnessed a decline in breadth by 13.33 percentage points and 20 percentage points, respectively. Nifty Auto saw its breadth reduce by 20 percentage points, with only 33.33 per cent of stocks trading above the 200-DMA. The financial space witnessed significant weakness during the period. Nifty Bank recorded a decline of 16.67 percentage points, with only 16.67 per cent of constituents trading above their 200-DMA. Nifty Financial Services and Nifty Private Bank saw sharper declines of 25 percentage points and 30 percentage points, respectively, leaving only 5 per cent and 20 per cent of stocks above their long-term averages. Nifty PSU Bank also weakened considerably, with breadth falling by 25 percentage points to 8.33 per cent, highlighting broad-based pressure across banking stocks. Among other sectors, Nifty IT declined by 20 percentage points, with only 20 per cent of constituents trading above their 200-DMA. Nifty FMCG also remained weak, with just 6.67 per cent of stocks above their long-term averages after a decline of 13.33 percentage points. These readings indicate that participation remains limited across several important sectors. Overall, the sectoral breadth profile weakened considerably during the period, with most sectors witnessing a decline in stocks trading above their 200-DMAs. While pharma and media continued to provide relative support, weakness across financials, IT and consumer-oriented sectors reflects a fragile market structure. A broader improvement in sectoral participation and a rise in stocks sustaining above their long-term averages would be required for a meaningful improvement in market breadth.

Indicator To Gauge Internal Strength

This indicator evaluates the underlying strength of the broader market by tracking the number of Nifty 500 stocks touching fresh 52-week highs and fresh 52-week lows. An increase in stocks making new highs along with a decline in fresh lows generally indicates improving market breadth and stronger participation. Conversely, a rise in fresh lows combined with the absence of new highs reflects weakening internal strength and increasing pressure across individual stocks. According to the latest reading, the Nifty 500 declined from 22,935.10 on September 23, 2026, to 22,072.10 on September 30, 2026, registering a fall of 3.76 per cent. During the same period, the number of stocks touching fresh 52-week highs remained unchanged at 0, while the number of stocks making fresh 52-week lows increased from 0 to 7. The latest data indicates a deterioration in broader market conditions, as the decline in the index was accompanied by a rise in stocks entering fresh 52-week low territory. The emergence of new lows suggests that selling pressure has intensified across individual stocks, indicating weakening market breadth. At the same time, the continued absence of fresh 52-week highs highlights the lack of strong upside participation and limited leadership within the broader market. Overall, the latest reading points to a weakening market structure, with the Nifty 500 declining while downside breadth deteriorated. The increase in fresh 52-week lows indicates renewed pressure among individual stocks, while the absence of new highs reflects a lack of momentum across the broader market. A sustained improvement in internal market strength would require a reduction in new low formations along with a gradual increase in stocks achieving fresh 52-week highs.

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