Daily Big Picture – Frontline Indices Snap Three-Day Losing Streak

Today’s Action:

Short covering by traders helped frontline indices to end in positive territory. Broader indices kept investors despondent.

Daily Market Review:

Benchmark indices snapped their three-day falling streak ahead of the February F&O expiry, as investors covered their short positions. Asian markets traded firmly in positive territory and this further boosted investor sentiment today.

After opening above the 10,400 mark the Nifty dropped in negative territory during the first hour of the trading session. However, as the day progressed it bounced back and ended the day with gains of 0.36% today.

BSE Sensex was more volatile today compared to the Nifty 50 and managed to post a gain of 0.42%.

Broader indices failed to capitalise on the yesterday’s outperformance. The Nifty Midcap and Smallcap indices lost 0.06% and 0.29%, respectively.

Out of the twelve sector indices, four ended in negative territory while the rest contributed positively in lifting the market spirit. Pharma and Metal stocks declined the most today while the Nifty IT index gained over 2% after Nasscom posted a growth outlook of 7-9% in export revenue for software services industry.

The IND 47 index, which is a list of top 47 stocks in chart and fundamental characteristics rose 0.17% today.

The advance-decline ratio was in favor of losers today. Out of 1598 stocks, 585 stocks advanced while 951 declined. A total of 62 stocks remained unaffected by today’s movement.

BHEL won an order worth INR 1,034 crore from Hindustan Petroleum Corporation for setting up a gas turbine based captive power plant at Visakhapatnam.

The Nifty and the Sensex observed divergence in trading volume today. The former observed a higher trading volume while the latter witnessed a lower trading volume compared to yesterday’s trading session. The distribution day count remains unchanged at five and six on Nifty and the Sensex while the Indian market remains in ‘’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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