Today’s Action:
Benchmark indices traded higher in today’s session, making it the fourth consecutive session of gains. Broader indices moved higher, in line with the frontline indices.
Daily Market Review:
The benchmark indices continued their positive momentum from yesterday’s session, as they gradually moved higher through the course of the day. The market took the RBI’s status quo on rates in its stride, even as there were small hopes of a 25 basis points cut in repo rate in light of the slowing growth in the economy.
The Nifty opened higher at 9,884.35. After finding support at 9,850.65, the index rallied to hit a high of 9,938.30 for the day. By the close of the session, the index settled at 9,914.90, gaining 0.56% from Tuesday’s close. The BSE Sensex put on gains of 0.55% in today’s session and closed at 31,671.71. The index opened at 31,522.17 and traded in the range of 31,457.78-31,752.16.
The market breadth, indicating the overall health of the market was in favor of gainers today. On the NSE, 863 stocks advanced, compared with 638 stocks declining, and 43 stocks remaining unchanged.
The broader markets extended their gains in today’s session. The Nifty Midcap and Smallcap indices advanced 0.34% and 0.77%, respectively, today.
The MarketSmith India IND 47 Index, which lists the top 47 stocks in chart on fundamental characteristics, gained 1.74% today.
Barring the Nifty Metal and IT indices, which shed 0.15% and 0.06%, respectively, all sectors ended in green today. The top three gainers in today’s session were the Nifty Pharma, Energy, and FMCG indices, rallying 1.71%, 1.67%, and 1.45%, respectively.
In key economic news, the RBI has kept its key lending rate—the repo rate—unchanged at 6%, in line with the consensus view on the Street. The six-member monetary policy committee (MPC), headed by RBI Governor, Urjit Patel, pointed to the rising inflation that is perilously inching toward the RBI’s 4% threshold level, as it decided to not pay heed to calls from the Finance Ministry and the industry to cut rates to spur growth in the economy.
Further, the RBI has said that the gross value added (GVA) growth forecast for FY 2018, has been revised to 6.7% from 7.3% earlier. Bank rate and marginal standing facility have been kept unchanged at 6.25%. The apex bank cut statutory liquidity ratio (SLR) by 50 basis points to 19.5% from 20%.
In the telecom sector, TRAI is set to issue recommendations on allowing full-fledged internet telephony in two to three weeks. The framework for Internet telephony (interconnect charges) is expected to be same as that of regular mobile and landline calls. With this development, over-the-top (OTT) services, such as Whatsapp and Skype, will come under the telecom licensing policy and be made to sign interconnect agreements with telecom service providers.
In stock news, shares of Natco Pharma were locked at 20% upper circuit, as the Company’s marketing partner, Mylan, has received U.S. Food and Drug Administration’s (USFDA) approval for Glatiramer Acetate Injection in strengths of 40 mg/mL and 20 mg/mL.
Shares of Cadila Healthcare gained 4.3% today, on the back of USFDA approval for Desmopressin nasal spray solution.
Both the Nifty and the Sensex witnessed lower trading volume in today’s session. The Nifty shed one distribution day today, on account of ageing. The distribution day count now stands at three for both the Nifty and the Sensex. The market status remains 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.
To Read Detailed Reports including Stock Recommendations, Idea Lists, Evaluate Stocks etc. Subscribe to MarketSmith India.