Manish Hathiramani, technical analyst at Deen Dayal Investments said, “While we have good support at 14,200-14,300, a buy on dips strategy would be most appropriate.”
“The market has got a renewed focus on segments, which are likely to be mostly benefited by a sustainable revamp in the domestic economy. The broader market is outrunning the benchmark with pharma, infra and PSU banks as the imminent leaders. Positive quarterly earnings is leading to a large upgrade in earnings forecast, which is also acting as a key tailwind in the rally,” said Vinod Nair, Head of Research at
.
That said, here’s a look at what some of the key indicators are suggesting for Thursday’s action:
Alphabet shares power US market
The S&P 500 and the Nasdaq climbed on Wednesday, lifted by heavyweight Alphabet Inc’s shares after its strong results, while investors counted on more fiscal stimulus to ride out the economic downturn. Alphabet Inc jumped 7% as it benefited from lockdowns that drove retail and other advertisers online. The S&P 500 gained 13.23 points, or 0.35 %, to 3,839.54 and the Nasdaq Composite rose 98.05 points, or 0.72 %, to 13,710.83.
European shares rise on positive earnings
European shares rose on Wednesday as focus remained on a busy day of earnings, with Italian shares outperforming after President Sergio Mattarella looked set to ask former European Central Bank chief Mario Draghi to form a government. The STOXX 600 index rose 0.16% for the third straight day, with Novo Nordisk A/S jumping 2.57% after the diabetes drug maker gave upbeat sales and profit forecasts for 2021.
Tech View: Nifty forms Hanging Man pattern
Nifty formed a ‘Hanging Man’ kind of pattern on daily charts on Wednesday, which is a bearish reversal pattern, a hint that the ongoing rally may be nearing its end, said analysts. “Despite this kind of sharp rise witnessed from the lows of 13,596 to a high of 14,868, the momentum oscillators are presenting a completely different picture, as the daily MACD still remains in ‘sell’ mode, the RSI continues with lower tops and some other leading momentum indicators have reached the overbought zone,” said Mazhar Mohammad, Chief Strategist – Technical Research & Trading Advisory, Chartviewindia.in.
Check out the candlestick formations in the latest trading sessions
ETMarkets.com
F&O: VIX needs to cool day further
India VIX rose 1.74% from 23.34 to 23.74 levels. Now, it needs to cool down and hold below 20 level for a continuation in the ongoing momentum. The market witnessed noticeable Put writing at 14,000 and 14,500 levels and some Call writing at 16,000 and 15,500 levels, but there was unwinding at strike price 14,500. Options data suggested a wider trading range between 14,400 and 15,200 levels.
Stocks showing bullish bias
Momentum indicator Moving Average Convergence Divergence (MACD) on Wednesday showed bullish trade setup on the counters of Punjab National Bank, Tata Motors, Indian Oil Corporation, Canara Bank, IndusInd Bank, Sun Pharma, Union Bank of India, Bajaj Consumer Care, Manappuram Finance, HCL Infosystem, Central Bank, Jain Irrigation, Power Finance Corporation, Equitas Holdings, Deepak Fertilisers, Adani Enterprises, Welspun India, Sadbhav Engineering, Meghmani Organics, ISGEC Heavy Engineering, Escorts, Manali Petrochem, MSTC, Gujarat Narmada Valley Fertilizers, Jamna Auto, Venky’s (India), Everest Kanto Cylinder, Nagarjuna Fertilizer, JMC Projects, OnMobile Global, Pricol, Aegis Logistics, Astral Poly Technik, Refex Industries, Sadbhav Infrastructure, Radico Khaitan, Cochin Minerals and Bajaj Healthcare.
Stocks signalling weakness ahead
The MACD showed bearish signs on the counters of Havells India, D B Realty, HKG, Jyothy Labs, Prime Fresh, Vinyoflex, Prabhat Technologies, Aditya Spinners, VCU Data Management, Gujarat Apollo Industries, Karnavati Finance, Duroply industries, Asahi Songwon Colors, Arfin India, Simplex Castings, P&G Health, Chandra Prabhu International, Seasons Textiles, Landmark Property Development, Welcast Steels, Kirloskar Industries, Next Mediaworks, Amforge Industries and Ceeta Industries.
Wednesday’s most active stocks
Tata Motors (Rs 543.29 crore), RIL (Rs 178.17 crore), ICICI Bank (Rs 167.33 crore), SBI (Rs 144.76 crore), IndusInd Bank (Rs 130.42 crore), Grasim Industries (Rs 120.45 crore), Vodafone Idea (Rs 118.61 crore), Bharti Airtel (Rs 85.10 crore), PNB (Rs 85.03 crore) and Maruti Suzuki (Rs 74.82 crore) were among the most active stocks on Dalal Street on Wednesday in value terms.
Wednesday’s most active stocks in volume terms
Vodafone Idea (Shares traded: 9.66 crore), PNB (Shares traded: 2.28 crore), YES Bank (Shares traded: 1.91 crore), BHEL (Shares traded: 1.78 crore), Tata Motors (Shares traded: 1.63 crore), Suzlon Energy (Shares traded: 1.55 crore), GTL Infra (Shares traded: 1.25 crore), GMR Infra (Shares traded: 1.05 crore), Reliance Communications (Shares traded: 0.83 crore) and Reliance Power (Shares traded: 0.82 crore) were among the most traded stocks in the session.
Stocks showing buying interest
Jubilant Life, IIFL Finance, Ceat, Astral Poly Technik and Shriram Transport Finance witnessed strong buying interest from market participants as they scaled their fresh 52-week highs on Wednesday signalling bullish sentiment.
Stocks seeing selling pressure
Indian Railway Finance Corporation, Ahlada Engineers and Fairchem Organics witnessed strong selling pressure in Wednesday’s session and hit their 52-week lows, signalling bearish sentiment on these counters.
Sentiment meter favours bulls
Overall, market breadth remained in favour of bulls. As many as 344 stocks on the BSE 500 index settled the day in green, while 151 settled the day in red.
Podcast: Should you book profits in cyclical stocks? >>>
There was no stopping the bulls as the benchmark indices hit fresh lifetime highs. Sensex closed above 50,000 for the first time in its history while 15,000 appeared to be the next stop for Nifty. The gains in the market were led by shares of banks, infrastructure and pharmaceutical companies. Nifty Bank clocked another record closing high. Sensex jumped over 450 points for the day whereas Nifty50 closed near the 14,800 mark. We caught up with Rusmik Oza of Kotak Securities to understand his views on the market.
