At 8:00 am IST, the SGX Nifty Futures was trading at 10,355, compared with Nifty’s close of 10,311 yesterday.
Market status: Confirmed Uptrend
Global stock markets: Dow 30, +0.6%; S&P 500, +0.7%; Nasdaq, +1.1%; KOSPI, -0.4%; Nikkei, -0.4%; Hang Seng, +0.3%; Shanghai Composite, -0.2%.
After a gap-up opening yesterday, Nifty continued to trade higher in the first hour but slipped more than 100 points from the high. In the second half, Nifty rebounded sharply and made a high of 10,394. However, Nifty closed 80 points off high with a gain of 0.7%. The broader market indices outperformed benchmark indices.
On the sectoral front, barring Nifty IT, all sectoral indices closed in the green. Nifty PSU Bank index closed 4% higher. Nifty Bank, Auto, Metal, and Pharma closed 1.5–2.5% higher. The advance-decline ratio was inclined toward advancers. Of 2,118 stocks traded, 1,324 advanced, 542 declined, and the remaining traded flat.
It is crucial for the Nifty to not breach its 100-DMA for the rally to continue. On the other hand, 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.
Info Edge (India) (Nse) reported its Q4 FY20 results yesterday after market hours. Revenue from operations grew 7.8% y/y to Rs 327 crore. PAT dipped 63% to Rs 119 crore.
Sudarshan Chemicals announced its Q4 FY20 results yesterday after market hours. Revenue from operations grew 4.5% y/y to Rs 449 crore. PAT increased 5.6% to Rs 27 crore.