Market status: Confirmed Uptrend

Distribution days: Four

Global stock markets: Dow 30, -0.04%; S&P 500, +0.03%; Nasdaq, +0.6%; Nikkei, -0.4%; Hang Seng, -0.8%; Kospi, +0.5%

Yesterday, markets made a new high in the morning, with Sensex moving above 50,000. However, it staged a downside reversal in the second half and closed in the red. As a volume in Nifty was higher compared with Wednesday's session, we marked yesterday’s session as a distribution day. The count is now elevated to four, with one set to expire next week. On the sectoral front, Nifty Auto closed flat, while the other indices closed with a cut. Nifty PSU Bank was down 3.3%. Nifty Metal, Realty, and Pharma closed at 1.5–2.5% lower.

With leadership broadening and indices above relevant intermediate-term moving averages, we will continue to look for leadership-quality growth names to form entry points. If a pullback/consolidation happens, it will be crucial for Nifty to hold its 21-DMA. It is advised to closely review the existing positions and book profits in stocks that are extended from their moving averages and showing technical weakness. Also, tracking distribution days is crucial as rising in distribution days can halt the uptrend.

Key News

Reliance Industries, Hdfc Life Insurance Co, and Yes Bank will report their Q3 earnings today.

Mphasis (Nse) posted Q3 FY21 earnings. PAT was up 8.8% q/q to Rs 325.5 crore, while revenue rose 1.6% q/q to Rs 2,474.3 crore. Margin was up 30bps q/q to 16.4%.

J K Tyre & Inds. posted Q3 FY21 earnings. Revenue was up 26% y/y to Rs 2,769.3 crore, while PAT stood at Rs 230.7 crore as against Rs 108.9 crore for the same quarter last year.

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, 84%; Rally Attempt, 4%; Uptrend Under Pressure, 12%; Downtrend, 0%.

For the 24 developed markets tracked by our institutional research team, the market status breakdown is as follows: Confirmed Uptrend, 66%; Rally Attempt, 0%; Uptrend Under Pressure, 34%; Downtrend, 0%.

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