Today’s Action:
Key indices turn red due to late sell-off in banks; Broader indices manage to outperform.
Daily Market Review:
Indian stock market left investors high and dry once again, as the key composites gave away early-session gains to end lower.
After opening on a positive note, both the Sensex and Nifty drifted lower by around 0.2% each. Weakness in private banks in the final hour of the session played spoilsport to a large extent.
Having witnessed over 1% declines for three days in a row, India’s broader indices breathed a sigh of relief today. The Nifty Midcap closed 0.02% lower, while the Smallcap index settled with a miniscule gain 0.15%.
In a stark contrast to recent sessions, the Nifty PSU Bank index managed to head 0.8% higher, supported by gains in all the 12 constituents. The Nifty Metal index emerged as the top gainer with 1.1% upturn.
The IND 47 index, which is a list of top 47 stocks in chart and fundamental characteristics, remained unaffected by the weakness in large-cap stocks. The index rose 0.4% today.
Losers (824) continued to have upper hand over gainers (681) on NSE today. 50 names remained unchanged.
While the PSU banking mess has taken a toll on the Indian market, continuous selling by FIIs this month has caught many investors off guard. As of February 19, 2018, FIIs had withdrawn almost Rs 10,000 crore from the Indian market.
Today’s loss on the Sensex came on higher volume as compared to yesterday, thereby making it a distribution day. However, the Nifty managed to escape distribution on account of lower downtick.
The distribution day count now stands at six on the Sensex and five on the Nifty. With both the key indices finding it hard to retake their 50-day lines, the Indian market remains in a spot of bother. The market condition stays unchanged at Uptrend Under Pressure.
Despite two down days in this week, both the major indices have managed to stay above their respective lows made on February 6, 2018. Looking at the current distribution count and if the key indices breach their previous lows, we might consider moving the Indian market to Downtrend.
Current Outlook:
– Be cautious with any new purchases
– Form a defensive game plan for your portfolio
– Stay disciplined and exercise sound sell rules
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