Nifty Hits New All-Time High; Reliance Led Today’s Rally

Nifty, +1.7%; Sensex, +1.8%; Nifty Midcap, +1.1%; Nifty Smallcap, +1.8%; Model Portfolio, +1.0%.

Market Pulse: Confirmed Uptrend

Distribution Day Count: Three

Weekly Market Review

Nifty closed in the green in all trading sessions of this week. It made a new all-time high of 15,469 in today’s trading session. Today, Nifty opened around 100 points higher and traded in a relatively narrow range. Gains were predominantly due to the surge in index heavyweight Reliance Industries (+6.0%). The broader market indices underperformed as Nifty Midcap (-0.04%) and Smallcap (-0.7%) closed in the red.

On the sectoral front, barring Nifty Metal (-0.9%) and Pharma (-0.4%), all sectors closed in the green. Nifty Media(+7.1%) was the top gainer for the week, followed by Nifty PSU Bank (+4.1%) and Nifty Realty(+3.4%). Today, the advance-decline ratio was in favor of decliners. Of the 2,040 stocks traded, 769 advanced, 1,206 declined, and the rest remained unchanged.

Last week, Nifty registered an additional follow-through day and has not added any distribution day after May 11. These are positive signs for a sustainable rally. Today, it made a new all-time high, which is a good sign for investors. 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.