The bulls were back in action as the markets gained nearly two per cent and settled around the day’s high.
BSE Sensex and Nifty 50 recovered nearly all the losses made in past two sessions on Tuesday as bulls took over D-Street. BSE Sensex surged 834 points or 1.72 per cent, while the broader Nifty 50 index added 240 points or 1.68 per cent. During intraday deals, Sensex jumped 936 points to hit a day’s high of 49,500 and Nifty 50 index touched a high of 14,546. Index heavyweights such as Housing Development Finance Corporation, Reliance Industries Ltd, ICICI Bank, HDFC Bank and Bajaj Finance contributed the most to the indices’ gain. In the broader market, S&P BSE MidCap index outperformed the large-caps, settling 2.3 per cent or 427 points higher at 18,953. While the S&P BSE SmallCap index, finished at 18,634.97, up 1.6 per cent or 305 points.
Milan Vaishnav, CMT, MSTA, Consulting Technical Analyst, Gemstone Equity Research & Advisory Services
There is no single reason that we can attribute to today’s rise. However, if we look purely from a technical perspective, the NIFTY saw a technical pullback from near its short-term 20-DMA. From a technical perspective, this session has defined a consolidation range for the nifty with 14650 as the upper limited and 14200 as the lower one. The 14200 level is the low point (14222) of yesterday’s trading session. Another reason that we can attribute to this rally is sharp short-covering from lower levels. Yesterday had seen some heavy short addition to high beta stocks that resulted into short-covering today. Broadly speaking, 14650-14222 is the range in which NIFTY is likely to stay over the immediate short-term.
Shrikant Chouhan, Executive Vice President, Equity Technical Research at Kotak Securities
The market has formed complete reversal formation by closing above the highest of the previous day, which was at 14459/49122. Today, all the sectors closed in positive territory. The market breadth was extremely encouraging. The unusual surge in the Hang Seng helped other Asian markets to trade higher. Along with Asian markets, today’s performance of US markets would decide the next course of action for our markets. The market is heading for 14580/49600 levels, which is a crucial hurdle point for the market. On the decisive break of 14580/49600 levels, it would result in retesting of 14650/49800 levels, which is an all-time highest level. On the downside, 14450/49100 and 14350/48800 would be major supports. The focus should be on Commodities and Pharmaceutical stocks.
Vinod Nair, Head of Research at Geojit Financial Services
Bulls took control after two days of a massive selloff, tracking positive cues from Asian markets and in expectation of a bigger US stimulus to keep the liquidity alive. Buying was seen across sectors with realty and PSU Banks outshining. The current market will get a further boost by foreign inflow if additional US stimulus kicks in. However, recent volatility in the market has increased due to concerns over high valuations and bond yields, investors should be watchful.
Ajit Mishra, VP – Research, Religare Broking Ltd
The bulls were back in action as the markets gained nearly two per cent and settled around the day’s high as well. After two days of slide, the benchmark opened higher, in response to an optimistic statement from US Secretary of Treasury, Janet Yellen, about a big fiscal push in the US. The momentum further gained strength as the session progressed, with healthy buying across sectors. The broader markets too posted decent gains in the range of 1.6-2.3%. Going ahead, earnings and global cues would remain on the participants’ radar. Besides, we’re also seeing noticeable buzz across the sectors in the run-up to Budget. We feel it would be prudent for the markets to spend some time around the current levels. Meanwhile, there’ll be no shortage of trading and investment opportunities, thanks to prevailing earnings season and upcoming budget. Amid all, we suggest not to go overboard and stick to the quality names and accumulate them on dips.