Nifty Ends the Week on a Strong Note; Broader Market Indices Outperform

Weekly Action

Nifty, +2.4%; Sensex, +1.9%; Nifty Midcap, +5.2%; Nifty Smallcap, +3.8%; Model Portfolio, +5.2%.

Market Pulse: Confirmed Uptrend

Distribution Day Count: Three

Weekly Market Review

Nifty started the week on a strong note and closed above 14,000 decisively on Monday. Also it traded above 14,000 in the next four trading sessions. Today’s action qualifies as an additional follow-through-day as Nifty advanced about 1.5% on volume higher than previous session. During the week, broader market indices outperformed the general market.

Barring Nifty FMCG (-0.3%), all the sectors closed in the green. Nifty Metal (+8.3%) was the major gainer, followed by Nifty IT and Media, which advanced 6.9% and 5.9%, respectively. Today, the advance-decline ratio was inclined toward the advancers. Of the 2,222 stocks traded, 1,058 advanced, 846 declined, and the remaining were unchanged.

With leadership broadening and indices above relevant intermediate term moving averages, we will continue to look for leadership-quality growth names to form entry points. If a pullback/consolidation happens, it will be crucial for Nifty to hold its 21-DMA. It is advised to closely review the existing positions and book profits in stocks that are extended from their moving averages and showing technical weakness. Also, tracking distribution days is crucial as rise in distribution days can halt the uptrend.