Q2 results of Infosys, Wipro and Mindtree coming today will be significant for the IT sector that has been underperforming after TCS results fell below market expectations. The strength of banking stocks reflects optimistic investor expectations, said an analyst.
“An important trend in the market in recent days is the market resilience in spite of selling by both FIIs and DIIs. This new trend reinforces the dominance of retail investors and the success of the ‘buy on dips’ strategy. We don’t know how long this trend will continue and this strategy will work. But now this trend is strong and might continue till an event triggers a trend reversal,” said VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services.
How are bluechips doing
After opening in the green, benchmark indices continued to gain momentum. At 9.20 am, BSE flagship Sensex was up 247 points, or 0.41 per cent, to 60,532. NSE benchmark Nifty advanced 90 points, or 0.50 per cent, to 18,082.
“On technical front, Nifty50 has been closing in green for the last four days and once the index closes above 18,000 level, this will open gates for 18,400-18,500 levels in the short term. Immediate support level for Nifty50 is at 17,800 while 18,200 may act as an immediate resistance,” Mohit Nigam, Head – PMS, Hem Securities, said.
In the 50-share pack Nifty, Tata Motors was the biggest gainer, up 10 per cent. M&M, Asian Paints, Tech Mahindra, Tata Consumer, Adani Ports, Power Grid, Divi’s Labs and Kotak Mahindra Bank were among other gainers.
ONGC was the top loser in the pack, down 1.10 per cent. Eicher Motors, Tata Steel, Hindalco, HUL, Grasim Industries, JSW Steel and Coal India were among those that traded in the red.
FACTORS DRIVING MARKETS
Good news
Inflation falls: The decline in CPI inflation to 4.35 per cent in September is positive since it supports the RBI’s view on inflation and will allow the MPC to continue with the accommodative monetary stance.
Bad news
Tapering imminent?: Three Fed policymakers said on Tuesday the economy has healed enough for the central bank to begin to withdraw its crisis-era support, cementing expectations the Fed will start to taper its monthly bond purchases as soon as next month.
Crude oil: Oil prices are currently near multi-year highs, but were steadier in Asian morning trading. Brent crude fell 0.29 per cent to $83.18 a barrel, just off Monday’s three-year high of $84.6, while US crude shed 0.2 per cent to $80.48 off Monday’s seven-year high of $82.18.
Broader markets
Broader market indices were trading higher, outperforming their headline peers in morning trade. Nifty Smallcap was up 0.66 per cent while Nifty Midcap declined 0.67 per cent. Broadest index on NSE, Nifty 500, was up 0.53 per cent.
Dilip Buildcon, SpiceJet, EID Parry, Ashok Leyland, BHEL and Tata Chemicals were gainers from the space while Concor, Zee Entertainment, Endurance Tech, Radico Khaitan, TV18 Broadcast and IDBI were under selling pressure.
Global markets
eMSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.1 per cent in early trading, steadying after falling over 1 per cent a day earlier, in what was its worst daily performance in three weeks.
Moves were muted in most markets. Chinese blue chips were flat, Australia eked out a 0.06 per cent gain, while Japan’s Nikkei shed 0.2 per cent. Hong Kong’s stock market was closed in the morning because of a typhoon.
Things to watch out for:
-Q2 earnings: Infosys, Wipro, MindTree, National Standard (India), Plastiblends India, Aditya Birla Money, Morarka Finance, Stratmont Industries and Perfect-Octave Media Projects
-Macro data: Chinese trade figures, US consumer price inflation data, minutes of the US Federal Reserve’s September policy meeting
