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Nifty Closes At All-Time Highs; PSU Bank and Auto Stocks Rally

November 18 2020

Today’s Action

Nifty, +0.5%; Sensex, +0.5%; Nifty Midcap, +1.5%; Nifty Smallcap, +0.3%; Model Portfolio, +0.6%

Market Pulse Confirmed Uptrend

Distribution Day Count: Zero

Nifty opened on a flat note and was volatile in the first half of the session. Post noon, buying was seen across the sectors, and Nifty made an all-time high for the third consecutive session. 52% of the Nifty50 stocks advanced today, led by Mahindra & Mahindra (+10.8%) and Tata Motors (+9.8%).

On the sectoral front, the majority of the sectors ended in the green. Nifty PSU Bank (+3.6%) advanced the most, followed by Nifty Auto (+3.1%) and Realty (2.1%). Market breadth remained in favor of advancers. Of 2,216 stocks traded, 1,096 advanced, 764 declined, and the rest remained unchanged.

Our approach toward the market turned cautious as Nifty is currently trading over 20% above its 200-DMA, which is rare. We might expect some pullback in the market. Thus, we turned cautious while adding and closely reviewing the existing positions. It is also advised to 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. Accumulation of distribution days can halt the uptrend.

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