After big upmove today, Nifty near crucial resistance zone
Premium- The index has reached closer to its resistance zone of 17950-18000 mark
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Indian markets started November on a strong note with IT and banking stocks helping Sensex and Nifty close about 1.4% higher after three straight sessions of losses. The blue-chip NSE Nifty 50 index closed up 1.46% at 17,929.65, while the benchmark S&P BSE Sensex gained over 800 points to 60,138. In line with the move, the market breadth was also strong with BSE midcap and smallcap indices surging 1.8% and 1.1% respectively.
After hitting hit multiple all-time highs last month, in previous three sessions the Sensex and Nifty had slumped over 3% each amid valuation concerns and heavy selling by foreign investors.
“Today markets witnessed a rebound and gained nearly one and a half percent, taking a breather after the recent fall. Upbeat global cues triggered a firm start however profit taking at the higher levels capped the upside. However, the news of GST collection reaching closer to record high fueled fresh momentum in the latter half, which further strengthened with recovery in select index majors. We feel it’s a rebound and the bias would change if Nifty manages to cross and hold above 18,100. Meanwhile, participants should continue with the cautious approach and do not jump into a trade. The upcoming US Fed meet and earnings will dictate the trend ahead," said Ajit Mishra, VP - Research, Religare Broking Ltd.
A key Federal Reserve meeting this week where the focus is on the central bank's plan for tapering its pandemic stimulus measures.
IndusInd Bank stole the show in the Sensex pack, surging 7.46 per cent, followed by Bharti Airtel, HCL Tech, Tata Steel, Tech Mahindra, Dr Reddy’s and SBI.
Market major HDFC advanced 1.74 per cent after the mortgage lender reported a 32 per cent rise in standalone net profit to ₹3,780 crore for the September quarter
Manish Hathiramani, proprietary index trader and technical analyst, Deen Dayal Investments, said: “The Nifty has risen smartly to get past the 17900 level. If we can keep above this level for a couple of trading sessions, the uptrend should resume and take the index higher. On the downside, 17550-17600 has become a good support for the markets and until that does not break on a closing basis, it is safe to assume that the trend continues to remain on the upside."
The Nifty metal index added 3% on Monday, helped by a 8.8% jump in Steel Authority of India after the steelmaker posted a near eleven-fold surge in quarterly profit. The Nifty realty index climbed 4.03%. Demand for housing and office spaces is gaining traction as the economy opens up further and the festive season starts.
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Vinod Nair, Head of Research at Geojit Financial Services, says the sustenance of the trend will depend on the views provided by Fed regarding the current easy money policy to be announced on Wednesday
Rohit Singre, Senior Technical Analyst at LKP Securities, said: "The index has reached to its hurdle zone of 17950-18000 mark if managed to cross & sustain above-said levels then we may see addition in current extension towards 18100-18200 zone quickly but if failed to hold then some profit booking can see towards 17850-17750 zone which are immediate supports zone on the downside where one can again look for buying opportunity." (With Agency Inputs)
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