Realty and Financials Drag Index; Cipla to Form JV With Kemwell Biopharma

Nifty, +0.1%; Sensex, -0.03%; Nifty Midcap, +0.3%; Nifty Smallcap, +0.8%; Model Portfolio, +0.5%

Market Pulse: Confirmed Uptrend

Distribution Day Count: Four

Today, after a flat opening, Nifty hit fresh highs of 16,713 in the first half of the session. However, the index staged a reversal in the second half. It pared all the gains for the day and closed flat. Volume was lower than in the previous session. The broader markets continued their outperformance. Midcap was up 0.3% while Smallcap advanced 0.8%.

On the sectoral front, Nifty Metal (+0.5%) extended its gain. Nifty FMCG and Nifty IT posted smart recovery, gaining 0.6% and 0.7%, respectively. On the flip side, Nifty Realty, Nifty Pharma, Nifty Auto, and Nifty Bank were down 0.3–0.8%. The advance-decline ratio turned to favor advancers. Of 2,004 stocks traded, 957 stocks advanced, 539 stocks declined, and the remaining closed flat.

The distribution day count currently stands at four. Nifty is trading near its all-time high. If the index adds a couple of distribution days, stages a reversal, or breaches its key moving averages, we may change the market status to an Uptrend Under Pressure. Reducing exposure to stocks breaking below their 21- or 50-DMA on higher volume is important. Further, in the broader market, we recommend being selective when investing in new stock.