At 8:00 am IST, the SGX Nifty Futures was trading at 9,781.3, compared with Nifty’s close of 9,881.2 yesterday.
Market status: Confirmed Uptrend
Global stock markets: Dow 30, -0.7%; S&P 500, -0.4%; Nasdaq, +0.2%; KOSPI, -0.7%; Nikkei, -0.9%; Hang Seng, -1%; Shanghai Composite, -0.3%.
Yesterday, Nifty opened briefly lower but moved more than 1% higher from there. Gains faded in the second half of the day and Nifty slipped in negative territory. As volume was lower compared with Tuesday's session, we did not consider yesterday’s action as a distribution day. On the sectoral front, Nifty Auto, IT, Pharma, and Realty closed 0.2–0.8% higher, while Nifty Bank, Financial Services, Metal, and FMCG closed 0.4–0.8% lower. The broader market outperformed benchmark indices.
Although we are in a Confirmed Uptrend, our approach has turned cautious toward the market. We are ready to book smaller than usual profits if any selling pressure is observed. If we see Nifty add more distribution days, breaching key moving averages, and begin to see leaders falter at support, we will likely shift the market status to an Uptrend Under Pressure.
The beauty of our CAN SLIM method is that we need not "expect," "hope," or "wish for" with respect to market action. We will take what the market gives us and continue to monitor unfolding conditions. We always look for stocks with strong relative strength. But investors should understand that it is not prudent to blindly buy stocks that have a high relative strength or simply because they have been performing well. This is the essence of momentum investing, and it can get you into trouble. Rather, one should base buying decisions on sound fundamental and technical analysis. Only invest in stocks that have strong fundamentals (i.e., good sales, earnings, and margins, among others) and that are breaking out of sound base structures on heavy volume.
Jk Cement reported Q4 FY20 results. Revenue stood at Rs 1,545.7 crore as against Rs 1,564.6 crore for the same period a year ago. Profit increased 19% y/y to Rs 164.1 crore.
Fortis Healthcare (Nse) reported Q4 FY20 results. Revenue stood at Rs 1,112.9 crore as against Rs 1,184.2 crore for the same period year ago, while the company reported a loss of Rs 44.51 crore as against a profit of Rs 135.60 crore in Q4 FY19.
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, 88%; Rally Attempt, 0%; Uptrend Under Pressure, 12%; Downtrend, 0%.
For the 24 developed markets tracked by our institutional research team, the market status breakdown is as follows: Confirmed Uptrend, 50%; Rally Attempt, 0%; Uptrend Under Pressure, 50%; Downtrend, 0%.