Daily Big Picture – Key Indices Take a Breather after Two Days of Gains

MarketSmith India_William Oneil IndiaToday’s Action:

The Nifty and the Sensex end flat, giving away most of the day’s gains. Broader Indices outperform key composites.

Daily Market Review

The benchmark indices ended flat on what looked like a day which seemed to have positive momentum following the gains witnessed on Monday and yesterday. By the close of trade, the headline indices gave away most of its gains and ended flat with a positive bias.

Today, the Nifty opened higher at 9,945.00. After touching an intraday high of 9,947.80, the index lost momentum and reached the intraday low at 9,883.75. The index finally settled at 9,904.15, up 0.07% from the last closing price. Similarly, the BSE Sensex opened at 31,919.17 and went on to hit an intraday high of 31,937.51. The index could not sustain at the day’s highs and slipped to an intraday low of 31,714.10. The Sensex finally settled at 31,795.46, up 24.57 points or 0.08% from yesterday’s close.

The market breadth, indicating the overall health of the market, was tilted towards the gainers in today’s session. On the NSE, 815 stocks advanced, compared with 629 stocks declining, and 69 stocks remaining unchanged.

The broader markets fared better in today’s trade, as the Nifty Midcap and Smallcap indices notched up 0.21% and 0.80%, respectively.

Similarly, the MarketSmith India IND 47 Index, which lists the top 47 stocks in chart on fundamental characteristics, advanced 0.72%, in today’s session.

On the sectoral front, the Nifty IT, Media, and Metal indices remained on top of the gainers list with upticks of 1.30%, 1.00%, and 0.74%, respectively. On the losing side, the Nifty Bank, Private Bank, and Auto indices dragged the market the most with losses of 0.82%, 0.82%, and 0.78%, respectively.

The Centre has come out with a draft of the National Pharmaceutical Policy, which aims to bring sweeping changes to the pharmaceutical industry. The policy aims to boost domestic manufacturing of drugs, impose a cap on trade margin, crack down on unfair marketing practices and limit ‘loan licensing’ by pharmaceutical companies. Loan licensing is a practice, where one company gets its products manufactured at a different company’s premises on a loan license contract. The policy also aims to create an environment suitable for research and development.

GMR Infrastructure shot up 19% intraday as the Supreme Court upheld an order by the Delhi High Court, which allowed the Company to use surplus land at the Delhi airport for non-aviation or commercial purposes. A government policy in 2016 had barred airports from using such land for non-aeronautical purposes. Investors see this as a positive move for GMR Infrastructure, which holds a 54% stake in Delhi International Airport Ltd (DIAL).

As part of its value-unlocking initiatives, Reliance Capital has filed an application with insurance regulator IRDAI for selling up to 25% stake in its wholly-owned subsidiary Reliance General Insurance Company (RGIC) to raise about INR 1,500-2,000 crore. With this, RGIC has become the fourth general insurance company in the country to have announced its intentions to get listed on the stock exchanges. Separately, Reliance Capital is aiming to list Reliance Nippon AMC and Reliance Home Finance this year.

Trading volume on the key indices today was lower in comparison to yesterday’s session. The distribution count for the Nifty and the Sensex remains 5.0 and 6.0, respectively. Currently, the indices are about 2.5% away from their all-time highs. The Indian market status is in Uptrend Under Pressure.

Current Outlook:

– Be cautious with any new purchases.

– Make a defensive game plan for your portfolio.

– Stay disciplined and exercise sound sell rules.

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