At 8:00am IST, the SGX Nifty Futures was trading at 12,979, compared with Nifty’s close of 12,858 yesterday.
Market status: Confirmed Uptrend
Distribution Day: Two
Global stock markets: Dow 30, -0.6%; S&P, -0.2%; Nasdaq, +0.5%; Nikkei, +0.6%; Kospi, +0.3%; Hang Seng, +0.1%
Yesterday, Nifty opened at record highs and traded in a narrow range for the first 30 minutes. The index then saw a selling pressure, which dragged it lower by 300 points from its intraday peak of 13,145. Yesterday’s action qualified as a distribution day, as the fall was on volume higher than Tuesday’s session. Barring Nifty PSU Bank (+1.8%), all the sectoral indices closed in the red. Nifty Realty (-2.3%) declined the most, followed by Pharma (-2.1%) and Pvt Bank (-1.9%). Market breadth was in favor of decliners. Of 2,213 stocks traded, 1,111 advanced, 756 declined, and the rest remained unchanged.
We are in a Confirmed Uptrend but need to be prudent and cautious while adding fresh positions, as Nifty is currently trading ~20% above its 200-DMA, which is rare. We might expect some pullback in the market. However, a small pullback/consolidation is a constructive sign if Nifty holds its 21-DMA. It is advised to closely review the existing positions and book partial profits in stocks that are extended from their moving averages. We will look for leadership among some good stocks to push the market up. On the flip side, tracking distribution days is crucial. An accumulation of distribution days can halt the uptrend.
Yesterday, the FIIs bought Rs 24 crore, while the DIIs sold Rs 1,840 crore.
Future Consumer: Rajnikant Sabnavis has resigned as CEO.
Siemens: The company posted Q2 FY21 results. Profit stood at Rs 330.2 crore, compared with Rs 333.9 crore for the same quarter last year; revenue fell to Rs 3,546.8 crore from Rs 3,894.4 crore on a y/y basis.
O’Neil Market Condition Report
For the 24 emerging markets tracked by our institutional research team, the market status breakdown is as follows: Confirmed Uptrend, 72%; Rally Attempt, 8%; Uptrend Under Pressure, 20%; Downtrend, 0%.
For the 24 developed markets tracked by our institutional research team, the market status breakdown is as follows: Confirmed Uptrend, 88%; Rally Attempt, 0%; Uptrend Under Pressure, 12%; Downtrend, 0%.