Indian benchmark indices ended on a positive note in a highly volatile session amid October F&O expiry, with the Sensex closing 212.88 points, or 0.36 percent, higher at 59,756.84 and the Nifty gaining 80.70 points, or 0.46 percent, to 17,737.
The market opened higher and remained in the green in the first half but selling in the second part of the day dragged the indices in the red. The market, however, recovered smartly to close higher amid buying in metal, realty, power and oil & gas stocks.
In the October F&O series, the Nifty rose 5.4 percent.
"Weak signals from the global markets and elevated oil prices are challenging the domestic market to maintain its gains. The US IT giants' disappointing quarterly earnings served as the catalyst for selling in the US market," said Vinod Nair, Head of Research at Geojit Financial Services.
The European Central Bank (ECB) is expected to increase rates by 75 basis points. Investors expect central banks to slow down the pace of rate hikes in the future, which could be positive for India in 2023, he added.
Stocks and sectors
JSW Steel, Hindalco Industries, Tata Steel, Adani Ports and Power Grid Corporation were among the top Nifty gainers, while losers included Bajaj Finance, Bajaj Finserv, Asian Paints, Bajaj Auto and Nestle India.
Among sectors, Nifty energy, metal and infra gained 1-2.7 percent, while FMCG, pharma and PSU bank indices gained 0.5 percent each. Selling was once again seen in information technology stocks.
The BSE midcap and smallcap indices were up 0.4 percent each.
On the BSE, metal and realty gained 3 percent each. Power and oil & gas indices rose 1-2 percent. The IT index shed 0.5 percent.
A long build-up was seen in RBL Bank, GMR Infra and Atul, while a short build-up was witnessed in NMDC, Mphasis and Mindtree.
Canara Bank, Bharti Airtel, Cipla, Cochin Shipyard, Granules India, Godfrey Phillips India, Karnataka Bank, Karur Vysya Bank, Phoenix Mills, PC Jeweller, Maharashtra Scooters, SJVN, South Indian Bank, Sun Pharmaceutical Industries touched their 52-week high on the BSE.
On the other hand, Amber Enterprises, NMDC, Delhivery, TeamLease Services, Mphasis, Gland Pharma, NMDC and FSN E-Commerce Ventures touched 52-week low.
Outlook for October 28
Gaurav Ratnaparkhi, Head of Technical Research, Sharekhan by BNP Paribas
The Nifty is trading near 78.6% retracement of the entire September decline, which is near 17800. Over there the index formed a bearish outside bar as well as an Engulfing Bear candle on October 25. Whereas, today, the index formed an Inside bar on the daily chart. The hourly chart shows that the index is forming a distribution below this key Fibonacci retracement for the last couple of sessions.
Structurally, the index is likely to trade with sideways to bearish bias in the short term. As long as the Nifty stays below 17800 on a closing basis it is likely to test 17500 in the short term.
Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities:
Trading session was marked by extreme volatility on the monthly F&O expiry day, but sharp rally in metals, realty and oil & gas stocks helped markets maintain the bullish sentiment seen in the recent trades.
Investors are positive about the India growth story, which is driving markets higher despite several headwinds on the external front.
Technically, for the last three sessions, the Nifty has consistently found resistance near the 17800 level and conversely taking support near 17625.
For Nifty, 17800 would be the key breakout level and above the same the index could move up to 17900-18000. On the flip side, a fresh round of selling is possible only after the dismissal of 17625. Below the same, the index could slip till 17500-17450.
Ajit Mishra, VP - Research, Religare Broking
Markets ended with modest gains on the expiry day of October month derivatives contracts amid mixed cues. After the initial uptick, the Nifty index oscillated in a range and finally settled closer to the upper band of the day’s range at 17,736.95 levels. Meanwhile, sectoral indices also traded mixed wherein buoyancy in realty, metal and oil&gas kept the traders busy while the IT pack was on the back foot. The broader indices too traded in sync with the trend and gained nearly half a percent each.
The consolidation in Nifty is on the expected lines and we recommend focusing more on the sector/stock selection for now. Apart from banking, sectors like auto and selectively pharma, realty and metal are likely to do well in near future. Participants should align their positions accordingly.
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