Market Pulse: Confirmed Uptrend

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

Global stock markets: Dow 30, -0.8%; Nasdaq, +0.1%; S&P 500, -0.3%; Nikkei, +0.8%; Kospi, -0.5%; Shanghai Composite, +0.1%.

Yesterday, the markets were highly volatile. Nifty started the session on a slightly positive note and turned negative within the opening hour itself. After making the day’s low of 17,287, there was some buying as the index rallied by around 150 points to make a new all-time high of 17,436. But volatility continued and Nifty closed with a minor cut. It was a mixed reaction on the sectoral front. Nifty FMCG, Media, and Fin Services closed 0.1–0.3% higher. Nifty Realty (-2.3%) was the top decliner, followed by IT (-1.3%) and PSU Bank (-1.3%). FIIs and DIIs were net sellers at Rs 145 crore and Rs 136 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

-RBI conducted a new 7-day Variable Rate Reverse Repo auction of Rs 50,000 crore.

Psp Projects bags projects worth Rs 133 crore in Gujarat.

Eid Parry (India) (Nse)’s board has approved setting up of a 120 KLPD grain/sugar syrup/molasses based distillery in Andhra Pradesh.

Buy Watchlist: Tata Power, Reliance Industries, Kei 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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