D-Street Traders Corner: Sensex back above 59000! What should investors do on Tuesday?

view original post

Indian stock markets bounced back on Monday after falling for 4 days in a row. The S&P BSE Sensex rallied more than 500 points to close above 59,000 while the Nifty50 closed just a shade below 17,700 levels.

See Zee Business Live TV Streaming Below:

Let’s look at the final tally on D-Street – the S&P BSE Sensex rose 533 points to 59,299 while the Nifty50 rose 159 points to 17,691.

Sectorally, buying was seen in metals, power, realty, and industrials while mild selling pressure was seen in industrials.

“After a week-long consolidation, the Indian market is back in action despite unfavourable global sentiments. The momentum is driven by the expectation of better Q2 earnings backed by recovery in economic activity, second wave fallout not being severe and in anticipation of a better outlook from festival demand,” Vinod Nair, Head of Research at Geojit Financial Services, said.

“The IT sector was under consolidation before the start of quarterly results, and RBI Monetary Policy Meeting is another key event that is being keenly watched by the market which is expecting no change instance,” he said.

On the broader market front – the S&P BSE Mid-cap index rose 1.5 per cent while the S&P BSE Small-cap index rose 1.7 per cent.

India VIX fell by 2.76 per cent from 17.21 to 16.73 levels. Overall spurt in the India VIX is giving a volatile swing but decline in volatility in the last few sessions may give some consolidation and support.

Technical experts are of the view that the Nifty50 should find near-term support near 17,600 whereas on the upside, the resistance level is placed at 17,800-17,900 levels.

We have collated views from different experts as to what investors should do when trading resumes:

Expert: Chandan Taparia, Vice President | Analyst-Derivatives at Motilal Oswal Financial Services Limited

The Nifty50 formed a Bullish candle on a daily scale and negated its lower highs formation of the last five sessions.

Now, the index has to hold above 17700 for an up move towards 17777 and 17850 levels whereas support is seen at 17580 and 17450 zones.

Expert: Rohit Singre, Senior Technical Analyst at LKP Securities

The Nifty index opened the day with a gap on the upside and managed to hold its bullish stream throughout the day. The index formed a bullish candle on the daily chart.

The index has seen a good pull back from its support zone of 17450 zone & now going forwards 17650-17600 will be immediate support zone.

If the Nifty manages to hold the above-said level, we may see the index to touch its immediate hurdle zone of 17760-17830 zone. The overall range is coming in between 17300-18000 zone either side breakout will decide the final direction.

Expert: Sachin Gupta, AVP, Research at Choice Broking

On the technical front, the Nifty index settled above the 20-days Moving Average which indicates an upside journey. The stochastic has given a positive crossover which indicates a positive trend.

On an Hourly Chart, the Index has taken support from 21 EMA and sustained above the same which suggests strength for the upside.

Also, the Parabolic SAR has formed below the candles indicating bullish momentum. At present, the index has immediate support at 17580 while has resistance at 17950 level.

Expert: Narendra Solanki, Head- Equity Research (Fundamental), Anand Rathi Shares & Stock Brokers

Sentiments got some support with Centre for Monitoring Indian Economy’s (CMIE) report that employment increased by 8.5 million in September, led by the salaried jobs category, as the unemployment rate declined to 6.9% during the month.

In another positive development, foreign portfolio investors (FPIs) were stood as net buyers for the second month in a row in the Indian market with an investment of Rs 26,517 crore in September.

However, markets trimmed some of their gains as traders were worried as trade deficit spiked to almost $23 billion in September from $13.8 billion in the previous month, as imports surged at a much faster pace than exports, driven by elevated global crude oil prices and purchases of gold in the build-up to the festival season.

(Disclaimer: The views/suggestions/advice expressed here in this article are solely by investment experts. Zee Business suggests its readers to consult with their investment advisers before making any financial decision.)