Daily Big Picture : Market Takes Breather, Avoids Distribution; IT Stocks Lead, Banks and Metal Stocks Lag

Today’s Action

Nifty, -0.1%; Sensex, +0.02%; Nifty Midcap, -0.7%; Nifty Smallcap, +0.04%; and Model Portfolio, -0.6%.

Daily Market Review

Market Status: Confirmed Uptrend

Today, the market took a breather after rallying for two days. Nifty closed flat in a relatively narrow range day. Despite the index trading flat, sectors had more action, with 2–3% moves in both directions. Action among leaders was mixed. Sectors like IT and Pharma that were out of favor after corporate tax rate cut announcement, were among top gainers today and Banks that were leading the rally lagged in today’s session. Barring IT and Pharma, all the sectoral indices are trading above their 50-DMA.

 Logistic stocks showed positive action after the commerce ministry sent the proposed National Logistics Policy to the Cabinet for approval. This policy can promote seamless movement of goods across the country and reducing high transaction cost of traders. The advance-decline ratio was in favor of decliners. Of the 2,133 stocks traded on the NSE, 813 advanced, 955 declined, and the rest remained unchanged.

Looking forward, we would like the quality growth names breaking out of the base on above-average volume. Look for the industries whose group rank is improving. For stocks, check Relative Strength line. An upward trending line is a positive sign. Also, do not hesitate to commit new capital to the stocks that are at 52-week/all-time high. Buy high and sell higher.

Key News

Biocon: The company’s subsidiary has acquired a Chennai-based biological research facility from Pfizer Healthcare. The acquired firm has 60,000 square feet research facility at Ticel Bio Park in Chennai. Biocon said that this acquisition will result into fast-forward development of its biosimilars from lab to pilot scale. The stock was down 0.4% today.

Wipro The company said that it would develop an online platform for the financial services industry in Brazil. Wipro will be responsible for design and delivery of the first phase of the online platform. The stock was up 0.6% today.

What do you think? Please email us any questions or comments.

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