Today’s Action:
Major indices bring home strong gains; follow-through day puts market in Confirmed Uptrend.
Daily Market Review:
Market bulls made a strong comeback, as India’s key indices accumulated sizable gains, buoyed by strength in global equity markets.
With trading volume higher than yesterday’s session, today’s action qualified as a follow-through day.
Today’s session began on an encouraging note, with both the frontline indices gapping up and rebounding from their 200-day lines.
RBI’s projection of lower inflation in FY 2019 added fuel to the rally, pushing the Sensex and the Nifty higher by 1.8% and 1.9%, respectively.
Broader indices also joined the party, as the Nifty Midcap and Smallcap indices outperformed their major counterparts with gains of 2.5% and 2.3%, respectively.
On the sectoral front, all the indices managed to deliver strong gains. Nifty PSU Bank (+4.9%) and Metal (+4%) were the top gainers. Nifty Bank, Private Bank, Realty, and Financial Services gained ~2.5% each in today’s session.
Our proprietary list of leading stocks, the MarketSmith India {IND 47 index} advanced in line with the frontline indices, gaining 1.7% in today’s trading session.
The advance-decline ratio was largely in favour of gainers today. Of the 1,611 stocks traded on the NSE, 1,344 gained, 220 declined, and 47 remained unchanged.
Amid fears of a global trade war, the Indian market did well to bring along a follow-through day. A couple of factors such as Skymet’s forecast of a normal monsoon in 2019 and RBI’s outlook of lower inflation has been welcomed by investors.
On the economic front, the Nikkei Services PMI improved to 50.3 in March, compared to 47.8 in February.
With the Indian market getting back in a Confirmed Uptrend, the green light is now on for investors to start looking out for growth stocks that are breaking out of sound chart patterns. Today’s follow-through day has brought along breakouts in few leading stocks, which is a positive sign. That being said, the resistance at 50-day line continues to be Nifty’s nemesis. The index closed 1.4% below its 50-day line. We will keep a close watch on that level in the coming sessions.
Current Outlook:
– Market environment conducive for purchases, but remain selective.
– Focus on fundamentally strong stocks breaking out of strong technical patterns.
– Stay disciplined and exercise sound buy and sell rules.
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