Market Pulse: Confirmed Uptrend
Distribution Day Count: Four
Global stock markets: Dow 30, +0.4%; Nasdaq, +0.1%; S&P 500, +0.4%; Nikkei, -1.4%, Kospi, -0.8%; Shanghai Composite, -0.3%
Yesterday, Nifty started on a positive note and traded in the green throughout the session. Being a monthly expiry day, intraday moves were minimal compared to a normal expiry session. Intraday, the index reclaimed its 21-DMA, but failed to close above it. Among Nifty50 stocks, 54% closed lower. It was a mixed action on the sectoral front. Nifty Metal (+5.0%) was the top gainer, followed by Nifty PSU Bank (+3.3%) and Realty (+1.6%). FIIs were net sellers with Rs 866 crore, while DIIs were net buyers with Rs 2,046 crore.
Currently, the distribution day count stands at four. Nifty is trading above its 50-DMA and closed just below its 21-DMA. Reclaiming its 21-DMA is crucial for a further upward move. On the flip side, if the index breaches its 50-DMA on higher volume and adds a couple of distribution days, we may change the market status to an Uptrend Under Pressure. We continue to recommend a selective approach to increasing risk. Focus on quality ideas emerging from sound bases with RS line at or near new highs while reducing exposure to stocks breaking below key support levels.
-China will hike more tariffs on exports of certain steel materials from next month. The move is likely to further benefit India’s steel industry. Export tariffs on ferrochrome will be raised to 40% from 20%. Also, export tax rebates will be removed for 23 steel products from August 1.
Container Corp.Of India’s Q1 FY22 PAT increased to Rs 258 crore versus Rs 58 crore in Q1 FY21. Revenue grew 52% y/y to Rs 1,819 crore. Margin expanded to 24.1% versus 13.3% in Q1 FY21.
T V S Motor’s Q1 FY22 missed estimates on all fronts. PAT increased to Rs 53 crore versus a loss of Rs 139 crore in Q1 FY21.