At 8:00am IST, the SGX Nifty Futures was trading at 11,938, compared with Nifty’s close of 11,897 yesterday.
Market status: Rally Attempt
Global stock markets: Dow 30, +0.4%; S&P, +0.5%; Nasdaq, +0.4%; Nikkei, +0.5%; Hang Seng, +0.6%
Yesterday, Nifty opened lower but rebounded quickly and gained almost 100 points from low. It gained more strength as the day wore on and made a high of 11,950. However, due to some selling pressure, Nifty closed below 11,900. Nifty is trading 3.7% and 11% above is 50- and 200-DMA, respectively.
On the sectoral front, Nifty IT closed 1.4% higher. On the flip side, Nifty PSU bank ended 1.2% lower. There was muted action in the rest of sectoral indices. Nifty Bank, Auto, Financial Services, and Pharma closed 0.2–0.3% higher, while Nifty FMCG (-0.4%) and Metal (-0.2%) closed lower.
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.
Key NewsHindustan Zinc reported Q2 FY21 results. Profit fell 6.8% y/y to Rs 1,940 crore, while revenue increased to Rs 5,560 crore from Rs 4,511 crore on a y/y basis. Margin improved 340bps to 51.3%.
Indian Energy Exchange reported Q2 FY21 results. Profit fell 3.7% y/y to Rs 47 crore, while revenue increased to Rs 71 crore from Rs 67.5 crore on a y/y basis.PBT increased to Rs 61.5 crore from Rs 60.7 crore on a y/y basis.
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%.