At 8:00am IST, the SGX Nifty Futures was trading at 11,853, compared with Nifty’s close of 11,873 yesterday.
Market status: Rally Attempt
Global stock markets: Dow 30, -1.4%; S&P, -1.6%; Nasdaq, -1.8%; Nikkei, -0.6%; Hang Seng, -0.2%
Nifty gapped higher yesterday and was able to sustain the gains, led by Bank and Financial Services stocks. The sentiment was positive toward these stocks as Hdfc Bank reported a strong set of Q2 FY21 numbers. Bank Nifty closed more than 3% higher and reclaimed its 200-DMA.
On the sectoral front, there was weakness in Pharma, Auto, and IT stocks. Broader market was underperforming in the first half but gained strength in the second half, with Nifty Midcap and Smallcap closing 0.7% higher.
Looking forward, we would prefer to see a follow-through day before shifting the market to a Confirmed Uptrend. (A follow-through day is a solid up session, generally a 1.5% or higher gain, with volume being higher than the previous day). Should this occur, the focus will be on ideas that show the best relative strength with good accumulation. Stocks that recover the quickest tend to lead the next run. On the flip side, if Nifty breaches its recent low of 10,790, the market will be moved back to a Downtrend.
Britannia Inds. reported Q2 FY21 results. Profit advanced 23% y/y to Rs 495.2 crore, while revenue increased to Rs 3,419 crore from Rs 3,049 crore on a y/y basis. Margin improved 360bps to 19.7%.
Century Text. (Nse) reported Q2 FY21 results. The company reported a loss of Rs 14.8 crore as against Rs 182.7 crore in Q2 FY20, while revenue fell 31.4% y/y to Rs 607.5 crore. Margin fell 870bps to 8.8%.
O’Neil Market Condition Report
For the 24 emerging markets tracked by our institutional research team, the market status breakdown is as follows: Confirmed Uptrend, 15%; Rally Attempt, 10%; Uptrend Under Pressure, 50%; Downtrend, 25%.
For the 24 developed markets tracked by our institutional research team, the market status breakdown is as follows: Confirmed Uptrend, 20%; Rally Attempt, 5%; Uptrend Under Pressure, 65%; Downtrend, 10%.