Nifty, +0.6%; Sensex, +0.8%; Nifty Midcap, +0.1%; Nifty Smallcap, +0.6%; Model Portfolio, -0.3%
Market Pulse: Confirmed Uptrend
Distribution Day Count: Three
Nifty gapped higher this morning but remained volatile in the opening hour. It gradually moved higher as the day progressed and closed above 15,300. Volume was comparatively low. Nifty is now less than 1% below its all-time high. Sensex also crossed the 51,000 mark and closed above that. Broader market indices underperformed benchmark indices. Barring Nifty Metal (-1.8%) and Nifty PSU Bank(-0.3%), all other sectoral indices closed in the green. Nifty Realty closed 2.8% higher. After many days of muted action, Nifty IT (1.8%) led the gains today. Nifty Auto, FMCG, Pharma, and Financial Service closed 0.1–0.5% higher. The advance-decline ratio was in favor of advancers. Of the 2,259 stocks traded, 1,223 advanced, 711 declined, and the rest remained unchanged. Nifty is trading 3% and 3.8% above its 21- and 50-DMA, respectively.
Last week, Nifty registered an additional follow-through day and hasn’t added any distribution day after May 11. These are positive signs for a sustainable rally. We would like the index to hold its 50-DMA and trade above that. Without trying to predict and decode stories, we will take what the market gives and continue to monitor unfolding conditions. If the index falls further, adds a distribution day, and breaches its key moving averages, we may change the market status to an Uptend Under Pressure. Focus on quality ideas emerging out of sound bases with RS line at or near new highs while reducing exposure to stocks breaking below key support levels.