The Indian equity benchmarks snapped their two-day losing streak on September 8 to end more than a percent higher on decline in crude prices, positive global cues and FII buying.
At close, the headline BSE Sensex was up 659.31 points or 1.12 percent at 59,688.222 while the Nifty ended the day higher by 174.35 points or 1 percent at 17,798.75.
All major US indices made significant gains on September 8 after seven days of decline amid fall in crude prices. The strong show by the US markets set the tone for the other global markets.
Crude oil dipped below $90 a barrel for the first time since early February, a big relief to India which relies on imports to met almost 80 percent of its needs.
"The domestic financial market experienced a wave of optimism, tracking strength across global markets as oil prices eased, cooling investor concerns about rising inflation,” Vinod Nair, Head of Research, Geojit Financial Services, said.
Despite premium valuations, consistent FII inflows were aiding Indian bourses, he added.
Shree Cements, BPCL, Axis Bank, Tech Mahindra and ICICI Bank were the top Nifty gainers, rising between 2.6 and 5.5 percent.
Hindalco, Tata Steel, SBI Life Insurance, Coal India and Tata Motors were among the top losers, slipping 0.8 to 2.8 percent.
| Index | Prices | Change | Change% |
|---|---|---|---|
| 59,688.22 | 659.31 | +1.12% | |
| Nifty 50 | 17,798.75 | 174.35 | +0.99% |
| Nifty Bank | 40,208.95 | 753.05 | +1.91% |
| Biggest Gainer | Prices | Change | Change% |
|---|---|---|---|
| Shree Cements | 24,458.45 | 1,277.40 | +5.51% |
| Biggest Loser | Prices | Change | Change% |
|---|---|---|---|
| Hindalco | 420.55 | -12.30 | -2.84% |
| Best Sector | Prices | Change | Change% |
|---|---|---|---|
| Nifty PSU Bank | 3119.65 | 76.45 | +2.51% |
| Worst Sector | Prices | Change | Change% |
|---|---|---|---|
| Nifty Metal | 6011.50 | -54.90 | -0.90% |
Among sectors, banking and financials jumped close to 2 percent each even as Nifty IT, auto and FMCG completed the list of sectoral gainers.
“Auto stocks were in focus as retail sales of automobiles grew 8.31 percent YoY in August,” said Nair.
Metal stocks were under pressure on demand concerns. The Nifty metals index closed 1 percent lower.
Stocks & sectors
On the BSE also, the banking and financial indices garnered strong interest. The BSE Bankex gained the most as it jumped close to 2 percent while the Private Banks Index bumped close to 1.75 percent. The BSE Finance gained close 1.5 percent.
Metal index was the biggest loser on the BSE as it tanked more than 1 percent while BSE Consumer Durable index lost close to 50 basis points.
The broader indices traced the trends in the benchmarks and closed in the green with BSE Midcap rising 0.3 percent while the BSE Smallcap ended the day with gains of 0.6 percent.
The India VIX, which indicates the degree of volatility traders expect over the next 30 days, corrected sharply by 5.5 percent from 19.4 to 18.3.
A long build-up was seen in the stocks of Shree Cements, Metropolis Healthcare and BPCL while a short build-up could be seen in Hindalco, Zee Enterprises and REC Ltd.
Among specific stocks, a volume spike of more than 300 percent was seen at the counter of Interglobe Aviation while Bandhan Bank and LIC Housing Finance witnessed a volume spike of more than 200 percent.
About 220 stocks hit their new 52 weeks high on the BSE which included Aditya Birla Fashion & Retails, Adani Enterprises, Bank of Baroda, Coal India, ICICI Bank, Indian Bank, ITC and Ujjivan Small Finance Bank among others.
Outlook for September 09
Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities Ltd
Positive global cues helped markets rebound from 2-day losses led by banking stocks. India's growth resilience is something that investors are betting on considering concerns of global slowdown amid rising interest rates.
Technically, the Nifty took support near 17690 and reversed thereafter. On daily charts, the index has formed a small bullish candle and has reclaimed the 20 day SMA (Simple Moving Average) level as well. For the trend following traders now the 20 day SMA or 17650 would act as a key support level. Above which, the index could rally till 17900-18000. On the flip side, below 17650, bulls may prefer to exit from the long positons.
Ajit Mishra, VP - Research, Religare Broking Ltd
Markets traded upbeat on the weekly derivatives expiry day and gained nearly a percent, tracking firm global cues. After the gap-up start, the Nifty hovered in a range and finally settled around the day’s high to close at 17,798.75 levels. Meanwhile, buoyancy across sectors especially in the banking and financials kept the participants busy. Besides, buying in midcap and smallcap space added to the positivity.
Nifty has again reached the upper band of the prevailing consolidation range (17,300-17,800) and a decisive breakout would fuel the next leg of the up move towards the 18,100+ zone. Importantly, the rotational buying across sectors combined with steady foreign flows has strengthened the possibility of a breakout. Participants should align their positions accordingly and avoid contrarian trades.
Gaurav Ratnaparkhi, Head of Technical Research, Sharekhan by BNP Paribas
The Nifty had taken support near the psychological mark of 17500 on September 07 & had started moving higher. The up move extended on September 08 as well. Consequently, the index is approaching upper end of the consolidation range. 18000-17200 has been the short term consolidation range. Thus the index is likely to stumble as it approaches the 18000 mark. The overall structure suggests that we are likely to see further consolidation before the index resumes the larger uptrend.
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