Sensex today rebounds over 600 points. Key things to watch at current levels
Premium- Strong global markets and earnings expectations lifted Sensex and Nifty
Indian markets rebounded today after a two-day selloff with strong support from financial stocks. Gains in global markets and expectations of strong earnings performance buoyed the sentiment. The blue-chip NSE Nifty 50 index rose 1% to 15,800 and the benchmark S&P BSE Sensex was up over 600 points.
The Nifty Bank Index, a major drag earlier this week, was up 1.5%. Shares of Bajaj Finace surged 5%. Jyoty Roy, deputy vice president, research at Angel Broking, said Bajaj Finance did post a fairly decent set of numbers and their guidance for credit cost is pretty encouraging.
Shares of consumer goods giant HUL was up 1.6% ahead of its earnings announcement scheduled later in the day.
"Although Indian markets are in an uptrend, if we look at recent data then it is seen that the index has not moved much since the start of June. Given the correction in the last couple sessions is more due to the effect of overseas markets, the short term trend will depend a lot on how they move in the next few days," said Sameet Chavan of Angel Broking.
The immediate supports for the Nifty are placed around 15550 and 15450, he said, adding traders are advised to avoid aggressive positions and look for stock specific trading opportunities.
Asian stocks were mostly higher today after postive corporate earnings helped Wall Street finish on a storng note overnight.
"The market pendulum swinging between risk-on & risk-off has become a trend now. However, the 15600 - 15900 range is unlikely to hold for long. If the upper band of 15900 is to be broken decisively, the essential requirement would be FIIs ceasing to sell at this level," says VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services.
"But even on Tuesday FIIs sold heavily ( ₹2385 cr). So watch out for FII activity. Meanwhile, the Delta variant scare, which led to the market sell-off on Monday on Wall Street, appears to have died down. Dr Fauci's statement yesterday that the vaccines are effective against all variants is reassuring," he added.
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Results declared recently show pressure in financials like banks, insurance firms and NBFCs. "But these pressures are likely to be short-lived. Asian Paints' excellent numbers indicate that there are pockets of business coming out with flying colours in these pandemic times," said Vijayakumar. (With Agency Inputs)
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