The stock market indices closed lower on volatile trading on December 29. Markets moved in a narrow range due to lack of investor participation ahead of the year end. After registering gains in the last two sessions, the market witnessed selective profit taking in metals and PSU stocks, which pulled down the benchmark indices. Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities Ltd, said, "The Nifty has maintained a higher bottom formation but after a strong pullback rally, the index has now formed a Hammer candlestick formation near the important resistance level which indicates strong possibility of a short-term weakness."
At close, the Sensex was down 90.99 points or 0.16 percent at 57,806.49. The Nifty was down 19.70 points or 0.11 percent at 17,213.60. About 1969 shares have advanced, 1317 shares declined, and 96 shares are unchanged. Bank Nifty closed the session at 35045.40 level with a loss of 138.40 points.
On the sectoral front, Nifty Pharma and Auto extended gains while Metals and Media were under pressure. Stocks like Eicher Motors, Bajaj Auto, Sun Pharma, Divis Lab ,were the top gainers while State Bank of India, ITC, Coal India, Tata Steel were prime laggards.
Chouhan said, ror the trend following traders, 17,200 would be the important level to watch out for, and above the same the uptrend momentum could continue up to 17,300-17,350 levels. However, if the index slips below 17,180, there is a strong possibility of a quick intraday correction up to 17,140-17,100.
Palak Kothari, Research Associate, Choice Broking said, "On the technical front, the index has been trading in falling channel formation, crossing above the upper band of formation can show an upside rally in the counter. Moreover, the index has been trading above 21&50-HMA which suggests strength in the counter. However, A momentum indicator STOCHASTIC and MACD trading with a positive crossover on the daily time-frame. At present, the Index has support at 17,000 levels while resistance comes at 17,300 levels, crossing above the same can show 17,400-17,500 levels. On the other hand, Bank Nifty has support at 34,500 levels while resistance at 35,500 levels."
Mohit Nigam, Head - PMS, Hem Securities said, "Strong buying is seen in selected pharma stocks while some selling pressure is seen in metal stocks today. Bajaj Auto is going to invest 300 crore to build capacity for 5 lakh EVs per year. The stock gained 3 percent today. Bajaj Auto can be a lucrative buy for investors as the stock is very cheaply priced currently. Strong buying interest was also seen in newly listed IPOs such as Latent View, Data Patterns, MapmyIndia, Supriya Lifesciences etc. Speciality Chemical Company Aether Industries has filed aDRHP for Rs 1,000 crores IPO.
"On the technical front, overall structure looks positive for Nifty 50 as it manages to sustain above 17,200 level on a closing basis. 17,000 and 17,400 are immediate support and resistance in Nifty. For Bank Nifty, 34,500 and 35,500 are immediate support and resistance."
Devarsh Vakil, Deputy Head of Retail Research, HDFC Securities, said, Healthcare stocks were in demand today. Anti-viral COVID-19 pill Molnupiravir got the Indian drug regulator’s nod on Tuesday and now will be manufactured by 13 Indian drug manufacturers. The Nifty Healthcare index rose 1.8 percent to 8860.2 extending gains for third consecutive sessions. The index has advanced 3.75% in three sessions.
"Nifty found resistance on the downward sloping trend line adjoining previous swing highs on the daily chart. 50 days EMA has also been acting as a hurdle for the Nifty at 17,340. Nifty has got strong support at the 17,050-odd levels, derived from the upward sloping trend line, adjoining previous swing lows on the daily charts," added Vakil.
Nagaraj Shetti, Technical Research Analyst, HDFC Securities, said, "The market seems to have placed at the crucial overhead resistance and lacking its strength to surpass above the hurdle. There is a higher possibility of further consolidation or downward correction in the next 1-2 sessions before showing further upside bounce again from the lows. Immediate support is placed at 17,100 levels."
Prashanth Tapse, Vice President (Research), Mehta Equities Ltd, said, "Nifty witnessed bearish pressure towards the fag-end of trading session. The negative takeaway was that the recent bullishness was seen fading as Omicron was seen hurting Dalal Street. Maharashtra Health Minister has said that curbs likely if Mumbai's positivity rate goes above 5 percent. Some part of pessimism can also be blamed to interest rate fears. Volatility is likely to be the hallmark of December 30's trade as traders will look to roll-over their F&O positions to January 2022 series. The spotlight will remain on Omicron developments and President Biden’s spending promises. Nifty bulls will reclaim the throne only above 17,389 hurdles. Also, the optimism could reverse and cause a nasty New Year's hangover if Nifty slips below 16,833 mark."
