Market Pulse: Confirmed Uptrend

Distribution Day Count:

Nifty50: Two Nifty Midcap100: Three Nifty Smallcap100: Two

Global stock markets: Dow 30, -0.2%; Nasdaq, +0.2%; S&P 500, -0.1%; Nikkei, -0.6%; Kospi, +0.3%; Shanghai Composite, -0.6%.

Volatility remained high in the markets yesterday. Nifty started the session with a gain of 50 points but quickly turned negative and made a low of 17,326. Later, there was strong buying at the lower levels as the index rallied over 250 points from the day’s low. All indices closed higher on the sectoral front, except for Nifty Auto (-0.5%) and PSU Bank (-0.1%). Nifty Realty (+3.6%) led the rally, followed by Metal (+2.6%). Nifty FMCG, Media, IT, and Pharma closed 1.1–1.9% higher. The advance-decline ratio was in favor of advancers. Of 2,023 stocks traded, 995 stocks advanced, 955 stocks declined, and the remaining closed flat.

The distribution day count currently stands at Two. Further, Nifty is now trading near its all-time high, above all its key moving averages. We would like the index to continue this trend. After such a sudden rally, one must also be prepared for some mild profit booking. In the process, if the index adds a couple of distribution day, stages a reversal, or breaches its key moving averages, we may change the market status to an Uptrend Under Pressure. Reducing exposure to stocks breaking below their 21- or 50-DMA on higher volume is important.

Key News

Glenmark Pharms. (Nse) gets the final approval from the U.S. Food and Drug Administration (USFDA) to market generic antibiotic cream.

Sterling And Wilson Solar commissions a 66MWp plant in Jordan. The project will save around 50,000 tonnes of carbon emissions annually and would also lead to larger-scale solar opportunities within the country.

Spicejet shareholders have cleared to raise Rs. 2,500 crore through the Qualified Institutional Placement (QIP) route.

Buy Watchlist: Mastek (Nse), Orient Electric, Reliance Industries, Bhansali Engr. (Nse), I G Petrochemicals, Birlasoft, Relaxo Footwears, Aarti Industries (Nse), Kalyani Steels, State Bank Of India, Colgate-Palmolive India, Berger Paints India, Icici Bank, Ratnamani Metals & Tubes.

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Author's Bio: 

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