The market bounced back on May 8 as buyers returned to accumulate stocks, especially those from rate sensitive sectors such as realty, banking and auto as data suggested the chances of another rate hike in the US are lower.
In the last few weeks the bond yields have gradually come down as central banks have adjusted their hawkish stance. This has led to improved investor confidence that interest rate will not rise from hereron, and thus not his consumption further.
The Nifty 50 index rose 195.40 points or 1.08 percent to 18,264.40. BSE flagship Sensex climbed 709.96 points or 1.16 percent to 61,764.25.
“Indian equities gained confidence from strong domestic earnings and fading concerns over the US economic slowdown following robust job data,” said Vinod Nair, Head of Research at Geojit Financial Services. “The recent weakness in the US dollar is drawing more foreign funds to the domestic market, with FIIs remaining net buyers for seven consecutive days.”
Stocks and sectors
Among the Nifty 50 stocks, IndusInd Bank was the top gainer rising 5 percent, followed by Tata Motors, Bajaj Finance and Bajaj Finserv. Biggest losers were Coal India, Adai Enterprises and Sun Pharma.
Sectoral matrix was largely in green. Nifty Auto was the top gainer, up 1.79 percent followed by Nifty Realty and Nifty Bank. Nifty Media and Nifty PSU Bank declined during the day.
Broaer market also saw buying albeit the intensity was a bit lower. Nifty Midcap 100 rose 1.02 percent while Nifty Smallcap 100 index climbed 0.94 percent.
| Index | Prices | Change | Change% |
|---|---|---|---|
| 61,940.20 | 178.87 | +0.29% | |
| 18,315.10 | 49.15 | +0.27% | |
| Nifty Bank | 43,331.05 | 132.90 | +0.31% |
| Biggest Gainer | Prices | Change | Change% |
|---|---|---|---|
| IndusInd Bank | 1,172.55 | 31.95 | +2.80% |
| Biggest Loser | Prices | Change | Change% |
|---|---|---|---|
| UPL | 679.70 | -14.70 | -2.12% |
| Best Sector | Prices | Change | Change% |
|---|---|---|---|
| Nifty Auto | 13750.90 | 102.40 | +0.75% |
| Worst Sector | Prices | Change | Change% |
|---|---|---|---|
| Nifty PSU Bank | 3959.30 | -42.50 | -1.06% |
OUTLOOK for May 9
Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities
While the undertone continued to remain bullish, the upbeat US market close last Friday further buoyed the local market sentiment. Hopes of interest rate hike cycle reaching its peak and banking woes in the US receding, investors latched upon rate-sensitive stocks of banking, automobile and realty as strong monthly sales numbers are pointing towards a decent recovery.
Technically, after a last Friday correction, benchmark Nifty one more time took support near 18050 and bounced back sharply. Post reversal, the index successfully cleared the short term resistance of 18200 which is broadly positive. On daily charts, the index has formed a bullish candle and currently it is comfortably trading above the 18200 level, which would be the sacrosanct support level. Above the same, the index could move up till 18350-18400, while on the flip side below 18200, the uptrend would be vulnerable.
Kunal Shah, Senior Technical and Derivative analyst at LKP Securities
The NIFTY index is being controlled by the bulls, and they have been able to maintain their grip. The index has gone beyond the high point it had reached in the previous week, and the strong buying has led to a shift in the base level from 18000 to 18200. The current situation suggests that the index is still in buy mode, and it will remain so as long as it manages to hold on to the support of 18200.
Siddhartha Khemka, Head - Retail Research, Motilal Oswal Financial Services
For the week, we expect the market to continue with its positive structure dictated by corporate earnings and consistent buying by FIIs. Investors would watch out for economic cues such as inflation data of India, the US and China along with UK GDP data and BoE interest rate during the week.