Key indices record sharp losses; broader market underperforms.
Daily Market Review:
Amid weakness in the global cues, frontline indices started the second half of 2018 on a subdued note.
The benchmark indices began the trading session on a positive note, but changed its trend early and dived lower. However, buying seen in the late hours limited the losses to 0.5% each in the benchmark indices.
The 50-pack Nifty breached its 50-DMA support again whereas the Sensex is 0.3% above its 50-day line.
In terms of the broader market, the selling pressure was intense as the Nifty Midcap and Smallcap dropped 0.7% each.
Decliners had an upper hand over gainers in an 11-6 margin on the NSE.
Barring few, most sector indices were in negative territory. Metal and Realty stocks were the most affected, losing 1.8% and 1.4%, respectively.
MarketSmith India IND 47 index, our proprietary list of top 47 stocks in chart and fundamental characteristics, declined 0.2%.
Talking about market direction, the distribution day count inched higher to five on both the benchmark indices. For the Nifty, the previous high of 10,929.20 serves as a crucial resistance zone. With the index falling below its 50-day line, the next level of strong support is around 10,550. The market condition remains unchanged at an Uptrend Under Pressure.
While both the key indices are only 3-4% away from their all-time highs, the Nifty Midcap and Smallcap are trading 17% and 26% from their 52-week highs, respectively. Both the index is now in a Downtrend as they are trading near to their previous lows.
– Be cautious with new purchases.
– Form a defensive game plan for your portfolio.
– Stay disciplined and exercise sound sell rules.
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