Daily Big Picture – MSP Hike Boosts Market Sentiment

Today’s Action:

Benchmark composites score good gains; broader indices underperform.

Daily Market Review:

After trading in a narrow range, frontline indices saw an increased buying interest following the Indian government’s decision to raise the minimum support price (MSP) for Kharif crops.

The Nifty and the Sensex ended with gains of 0.7% and 0.8%, respectively. 

In the broader market, buying interest was relatively muted as the Nifty Midcap and Smallcap gained 0.1% and 0.4%, respectively.

However, market breadth turned weak as 903 stocks declined and 826 advanced on the NSE.

On the sectoral front, most indices closed in positive territory barring Nifty IT (-0.7%), Media (-0.2%) and PSU Bank (-0.2%). Among the gainers, Nifty Auto (+1.3%), Financial Service (+1.0%) and Pharma (+0.8%) topped the table.

The MarketSmith India IND 47 index, our proprietary list of top 47 stocks in chart and fundamental characteristics, gained 0.2%.

Coming to the market direction, the distribution day count, which keeps a track of recent institutional selling remains at an elevated level of five on both the benchmark indices. The market condition remains unchanged at an Uptrend Under Pressure. For the Nifty, the previous high of 10,929.20 serves as a crucial resistance zone. With the index hovering around its 50-day line, the next level of strong support is around 10,550.

On the other hand, the Nifty Midcap and Smallcap indices remain in a Rally Attempt.

Current Outlook:

– Be cautious with new purchases.

– Form a defensive game plan for your portfolio.

– Stay disciplined and exercise sound sell rules.

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