Market Pulse: Confirmed Uptrend

Distribution Day Count: Three

Global stock markets: Dow 30, +0.2%; Nasdaq, -0.7%; S&P 500, -0.3%; Kospi, -0.7%; Nikkei, -1.2%; Shanghai Composite, -0.2%

Yesterday, Nifty opened flat and advanced in the first two hours of the session. It then consolidated gains for the rest of the day and closed holding on to decent gains. In the process, the index hit a fresh high. Volume was slightly higher compared with that in the previous session. In the broader market, the Smallcap index was up 1%, while the Midcap index advanced 0.5%.

On the sectoral front, mixed reactions were observed. Nifty Realty (+4.2%) was the day’s highest gainer. Similarly, Nifty IT kept the bullish momentum intact and advanced 1.3%. On the flip side, Nifty Pharma, PSU Bank, and Auto declined in the range 0.3–0.4%. The advance-decline ratio was in favor of decliners. Out of 2,272 stocks traded, 914 stocks advanced, 1,029 stocks declined, and the remaining closed flat.

Nifty is trading 1% above its 21-DMA after having recently reclaimed it. It is crucial for the index to hold and trade above this level. On the flip side, the distribution day count stood at three. If the index falls further and adds a couple of distribution days, we may change the market status to an Uptrend Under Pressure. We continue to recommend a selective approach to increasing risk. Focus on quality ideas emerging out of sound bases with RS line at or near new highs while reducing exposure to stocks breaking below key support levels.

Companies Announcing Results Today: Hdfc Asset Mgmt, Gna Axles, Just Dial, L&T Finance Holdings, Den Networks, and others.

Key News

Wipro (Nse) announced Q1 FY22 results, which were above consensus estimates. Revenue increased 12.4% q/q to Rs 18,368.4 crore. EBIT increased 2% to Rs 3,485.3 crore.

Larsen & Toubro Infotech’s Q1 FY22 results were in-line with consensus estimates. Revenue was up 5.9% q/q to Rs 3,462.5 crore. Profit declined 9% to Rs 496.8 crore.

Bandhan Bank released Q1 FY22 business update. Deposits at Rs 77,336 crore, up 27.6% y/y and 0.8% q/q. CASA ratio at 42.9% compared to 37.1% y/y and 43.4% q/q.

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Author's Bio: 

Marketsmith India, One stop solution for all your Stock Market needs. Get stock market ideas and stock predictions all at one place. A proprietary tool by William O'Neil India following the CANSLIM method of investing.