At 8:00am IST, the SGX Nifty Futures was trading at 13,247, compared with Nifty’s close of 13,134 yesterday.
Market status: Confirmed Uptrend
Distribution Day: Two
Global stock markets: Dow30, +0.3%, S&P500,-0.1%, Nasdaq,+0.2%, Nikkei, -0.4%; Kospi, +1.6%; Hang Seng, -0.1%
Yesterday, Nifty opened at a record high but surrendered gains as the day wore on. It was the second consecutive day when benchmark indices stalled and traded in a narrow range. However, midcap and smallcap indices continued to rally. On the sectoral front, Nifty IT, Financial Services, and Private Banks were lagging. On the flip side, Nifty PSU Bank (+4.8%), Metal (+2.5%), and Auto (+1.7%) pushed the market higher. Market breadth was skewed toward advancers. Out of 2,220 stocks traded, 1,357 stocks advanced, 549 declined, and the remaining stocks 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 equities worth Rs 3,637.4 crore, while the DIIs sold equities worth Rs 1,440 crore.
IDBI Bank received affirmation from Fitch with respect to its IDR rating at 'BB+' with negative outlook; however, its viability rating was upgraded to 'ccc+'.
Granules India received approval from the U.S. FDA for generic Cuprimine and penicillamine capsules.
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%.