Market Pulse: Confirmed Uptrend

Distribution Day Count: Nifty50: One Nifty Midcap100: Three Nifty Smallcap100: Four

Global stock markets: Dow 30, -0.2%; Nasdaq, +0.2%; S&P 500, -0.03%; Nikkei, +1.7%; Kospi, +0.1%; Shanghai Composite, +0.5%.

Last week, Nifty crossed 17,000 for the first time. The index moved to 17,000 from 16,000 in just 19 trading sessions, which was a new record for the fastest 1,000-point gain. It closed 3.7% higher for the week, the highest weekly gain since February 5. On Friday, the index was highly volatile. After opening on a positive note, it moved in a zig-zag manner throughout the session. Toward the end, it made a new all-time high and closed near the day’s high.

During last week, the broader market indices outperformed the general market. Midcap and smallcap were up 4.9% and 4.1%, respectively. All sectoral indices closed higher for the week. Nifty Realty (+10.8%) was the top gainer. Nifty Energy and Metal closed 4.1–5.0% higher. On Friday, FIIs and DIIs were net buyers at Rs 768 crore and Rs 668 crore, respectively.

Two distribution days expired last week, reducing the count to one. Further, Nifty is now trading near its all-time high and is placed 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 days, 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

Reliance Industries’s subsidiary, Reliance Strategic Business Ventures, acquired 2,28,42,654 equity shares in Strand Life Sciences for Rs 393 crore.

LIC acquired an additional 3.87% stake in Bank Of India via QIP. The shareholding rose to 7.05% from 3.17%.

Ashoka Buildcon gets orders worth Rs 1,570 crore in West Bengal.

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