Firm global cues lift market sentiment as Nifty scales back to 17k on strong all-round buying

Bank Nifty was up by 1.23 percent while Nifty Auto index rose 2 percent

FPJ Web DeskUpdated: Tuesday, April 26, 2022, 04:44 PM IST
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BSE midcap and smallcap indices up 0.7-1.5 percent. /Representative image |

The benchmark indices closed trading session on a positive note on April 26. Sensex reclaimed 57,000-mark while Nifty50 was above 17,100 led by a strong buying support in energy, IT, banking and auto stocks. All the stocks on the Sensex and Nifty were trading in green. Bank Nifty was up by 1.23 percent while Nifty Auto index rose 2 percent.

At close, the Sensex was up 776.72 points or 1.37 percent at 57,356.61. The broader Nifty was up 246.80 points or 1.46 percent at 17,200.80. About 1,886 shares have advanced, 1,422 shares declined, and 108 shares are unchanged.

Snapping two consecutive sessions of massive losses, the benchmark Sensex started the day in the positive at 57,066.24 points and soared to a high of 57,442.24 points in the intra-day. The Sensex had lost 1,331 points in the previous two sessions. The benchmark index had closed 617.26 points or 1.08 percent down on Monday.

The broader Nifty 50 of the National Stock Exchange surged 246.85 points or 1.46 per cent to 17,200.80 points against its previous day's close at 16,953.95 points. The Nifty 50 had lost 218 points or 1.27 percent on Monday. There was strong buying support in energy, IT, auto and banking stocks.

Among the top Nifty gainers were Bajaj Auto, Adani Ports, Hero MotoCorp, Power Grid Corp and M&M. Among the losers were ONGC, Apollo Hospitals, Axis Bank, Hindalco Industries and Asian Paints.

Only four of the 30 scrips that are part of the benchmark Sensex closed in the red. Axis Bank slipped 0.72 per cent to Rs 775.05. Asian Paints, Maruti Suzuki and TCS also closed in the red.

While markets are in an oversold position, the falling yields in US markets and sliding crude oil prices came as a major respite for investors who partially covered their short positions, said Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities Ltd. However, other concerns like China's coronavirus problems, likely interest rate hike woes in the US and the conflict between Russia and Ukraine will continue to be potential market spoilers.

Technically, once again the Nifty re-claimed the 17,000 mark and succeeded to close above the 50-day SMA which is grossly positive for the markets. After a promising pullback rally the index is trading near the 200-day SMA. For the short-term traders, the support has shifted to 17100 from 17000. "We are of the view that the intraday formation is positive and it is heading towards 17,300-17,350. On the flip side, a quick intraday correction is not ruled out if the index trades below 17,100 and below the same, it may retest the level of 17,50-17,000", added Chouhan.

The volatility index India VIX dragged 10 percent to close at 19.13 levels. On the derivative front, the Open Interest of call option is at 17500 strike price followed by 17200 strike price while on the put side, the OI is stood at 17000 strike price followed by 17100 levels. Sumeet Bagadia, Executive Director, Choice Broking said, technically, the Nifty index took support at Lower Bollinger Band formation, Ichimoku Cloud & sustained above it that indicates bullish move for the near term. Moreover, the index has closed above 50-days SMA, which suggests bullish strength for the coming day. On a weekly chart, the nifty index had formed a DOJI candlestick in the last week that shows indecisiveness among the traders. In addition, an indicator Stochastic has been moving near the oversold zone with positive crossover on the daily scale. At present, the index is having support at 17000 levels while resistance is placed at 17,415 levels. On the other hand, Bank nifty has support at 35,900 levels while resistance at 37,000 levels, Bagadia added.

Sentiment continues to remain firm

Indian equity markets sustained their gains in the late afternoon session as sentiment continued to remain firm in the backdrop of positive global cues, said Mohit Nigam, Head - PMS, Hem Securities. Benchmark indices closed in green with a gain of 1.46 percent. Mahindra & Mahindra, Indusind Bank and Power Grid were the prime gainers among heavy-weights. Traders remained optimistic after a private report stated that Finance Minister Nirmala Sitharaman held a meeting with representatives of the semiconductor industry of the US and invited them to make further investments in India.

HDFC Life Insurance Company reported a 12.44 percent year-on-year (YoY) rise in profit for the March quarter as compared to the same quarter last year.

On technical front, Nifty50 may take support at 17,200 levels and may face resistance at 17,450 levels. In case of Bank Nifty immediate support and resistance levels are 36,000 and 36,850 level respectively, added Nigam.

Asian markets in green

Asian markets were trading mostly in green as traders indulged in bargain hunting after the recent sharp sell-off. European markets were trading higher after falling sharply in the previous session on fears of a new Chinese lockdown and rapid interest-rate hikes in the United States.

Global shares fragile

World shares steadied on Tuesday after a late revival on Wall Street, although global growth fears stoked by China's COVID-19 curbs and fears of aggressive Fed tightening sapped risk appetite, lifting the dollar to new two-year highs, Reuters said.

The MSCI world equity index rose 0.1 percent from six-week lows by 0812 GMT, helped by a gain of 0.7 percent in Europe's STOXX 600 index on strong earnings by companies such as bank UBS and shipping group Maersk. However, China's blue chip index fell another 0.8 percent after its worst day in two years on Monday, even as the central bank vowed to step up prudent monetary policy support, particularly for small firms hit by COVID-19.

(With inputs from Reuters, Agencies)

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