Daily Big Picture : Nifty Retakes 100-DMA; Auto and Metal Stocks Lead the Gains

Today’s Action

Nifty, +0.8%; Sensex, +0.8%; Nifty Midcap, +0.2%; Nifty Smallcap, +0.1%; and Model Portfolio, +0.7%.

Daily Market Review

Market Status: Confirmed Uptrend

Nifty formed higher highs on the hourly chart backed by strong buying interest. The index retook its 100-DMA intraday and closed 20 bps above it with solid gains. However, despite strong gains, market breadth remained narrow as advance-decline ratio skewed toward decliners. Of the 2,145 stocks traded on the NSE, 861 advanced, 912 declined, and the rest remained unchanged. In the broader market, both Midcap and Smallcap indices posted a moderate gain of 0.20% and 0.10%, respectively.

On the sectoral front, Nifty Auto posted strong gains of 2.2% followed by Nifty Metal, which gained 1.6%. Barring Nifty IT (-0.5%), which continued to underperform, all other sectoral indices closed in positive territory.

Looking ahead, we would like Nifty to hold its key moving averages and trade with a clear uptrend. Further, a steady improvement in market breadth will indicate increasing strength in the market. On the flip side, if Nifty registers additional distribution days, it will be a subtle sign of weakness in the market.

Key News

Andhra Bank has announced to decrease its marginal cost of funds based lending rates (MCLR) and repo linked lending rate (RLLR) by 10bps across tenors from October 15 and November 1, respectively. The stock was down 1.3%.

Kaveri Seed Company launched its state-of-the-art biotechnology laboratory at Pamulaparthy in Telangana, today. This is part of the company’s strong focus on enhancing its R&D and innovation capabilities aimed at improving agricultural productivity. The stock was up 0.2%.

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

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