Nifty Slips Below 14,300; RIL, Titan, and HDFC Bank Outperform

Nifty, -1.1%; Sensex, -1%; Nifty Midcap, -2.1%; Nifty Smallcap, -1.8%; Model Portfolio, -1.9%

Market Pulse Confirmed Uptrend

Distribution Day Count: Three

Markets were under pressure this morning, with Nifty down more than 1% and Midcap index down 1.5%. During the day, Nifty attempted recovery from losses but failed to do so. As the volume was a little lower compared to Friday’s session, we will not mark today’s session as a distribution day. Among the Nifty50 stocks, Tata Motors, Tata Steel, and ONGC closed ~5% lower. On the flip side, a 1–2% gain in Reliance, Titan, and HDFC Bank saved indices from declining further. On the sectoral front, Nifty Metal was down ~4.5%. While Nifty Auto, IT, Financial Services, Pharma, and Realty closed 2–3% lower. Market breadth was skewed toward decliners. Of 2,243 stocks traded, 403 advanced, 1,527 declined, and the remaining were unchanged.

With indices above relevant intermediate-term moving averages, we will continue to look for leadership-quality growth names to form entry points. At the same time, the distribution day count is at three and many stocks have breached their 21- and/or 50-DMA. In this type of market, the message is to stay the course. We will continue to monitor the market and look for signs of strength or weakness. During pullback/consolidation, it will be crucial for Nifty to hold its 21-DMA (14,080). It is advised to closely review the existing positions and book profits in stocks that are extended from their moving averages and/or showing technical weakness. Also, tracking distribution days is crucial as a rise in distribution days can halt the uptrend.