Today’s Action:
Major indices score smart gains; broader market outperforms once again.
Daily Market Review:
With trade war fears subsiding, the Indian stock market mirrored a strong rally in global equities. Both frontline indices scored decent gains for the second consecutive session.
Benchmark indices strengthened as the day progressed, before ending the session with gains of 0.8%. The Nifty finally overcame its resistance of 10,770, making an intraday high of 10,818. Trading volumes were higher on the index once again.
In the broader market, buying interest remained strong for the second day in a row. The Nifty Midcap and Smallcap indices climbed 1.5% and 2.2%, respectively.
The overall market breadth was healthy, as gainers outnumbered decliners in a ratio of about 4:1 on the NSE.
On the sectoral front, strength was seen across the board as all sector indices moved higher. Nifty Realty (+3%), Metal (+1.5%) and IT (+1.2%) were the top gainers.
Our proprietary list of leading stocks, the MarketSmith India IND 47 index gained 2.2%, led by gains in broader market.
In a stark contrast to previous few sessions, we had some quality stocks making all-time highs in today’s trade. Stocks that scaled fresh highs in today’s session include Firstsource Solutions, VIP Industries, Britannia Industries, JSW Steel, Infosys, Bajaj Finance, and Gruh Finance.
While today’s strong session failed to have any impact on the Indian market condition, frontline indices have come close to their near-term resistance levels. For now, the Indian market continues to be in an Uptrend Under Pressure. While both key indices are only 2-3% away from their all-time highs, there is still some strong overhead resistance. For the Nifty, 10,930 level serves as a major resistance. On the downside, the 10,550 serves as a crucial support level.
After a horrible six-session losing streak, broader market indices have recovered some of their losses in the past two sessions. Even then, the Nifty Midcap and Smallcap are well below their January highs. The midcap and smallcap benchmarks have sold-off 14% and 21% from their highs and are currently in a Downtrend.
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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