Benchmark indices extended the gains after the Reserve Bank of India's (RBI) announcements which were directed mostly towards COVID-impacted sectors, ample liquidity and softening of yields.
The benchmark Sensex closed up 0.88 percent and Nifty 50 ended up 0.84 percent from Tuesday’s closing. Markets have held the support level of 14,500 in Nifty 50. Trading above this level is positive and could lead to 14,800-15,000 zone in near-term. Strong buying interest is seen across IT, pharma and financial sectors with Sun Pharma, UPL, Axis Bank among the top gainers in Nifty 50. Adani Ports, Bajaj Finance, SBI Life Insurance and Asian paints saw some losses.
"Comments from Yellen about rising yields have made US markets slightly volatile which can impact Indian market in the next 1-2 trading sessions, said Mohit Nigam, Head-PMS, Hem Securities. On Tuesday, US Treasury Secretary Janet Yellen said she sees no inflation problem brewing, downplaying earlier comments rate hikes may be needed to stop the economy overheating as President Joe Biden's spending plans boost growth.
Good corporate results so far and a possible reduction in COVID cases in, the next few days will provide support to the markets. Mohit Nigam, Head, PMS, Hem Securities.
Shrikant Chouhan, Executive Vice President (Equity Technical Research), Kotak Securities said, the narrow range activity continues but index recovered sharply from 14,500/48,250 support level. Among sectors, strong buying was seen in Pharma, Bank Nifty index while minor profit booking was seen in selective realty and financial stocks.
The Nifty has formed inside body candle formation near 20 day SMA and index once again manage to close above 20 day SMA level, which is broadly positive for the market. "We are of the view that, in the short run 14,500/ 48,250 should be the sacrosanct support area for the positional traders, above the same we can expect continuation of uptrend up to 14750/49200 further upside may also continue which could lift the index up to 14820/49850. On the flip side, trading below 14,500/ 48,250 could possibly open one more correction wave up to 14,450, 14,410/ 48,000-47,750," Chouhan said.