Frontline indices the 30-pack Sensex and 50-stock Nifty swung back into the green in the afternoon on March 19 recovering from intraday losses to hover near the day's high in a volatile session.
At 1.33 pm, the Sensex was up 261.57 points, or 0.36 percent, at 72,273.62, and the Nifty was up 74.50 points, or 0.34 percent, at 21,892.00. About 1,558 shares advanced, 1,699 declined and 92 were unchanged.
Along with the benchmarks, the trend reversed in the broader markets, too, with the mid and smallcap indices trading with mild gains. The volatility index India VIX sank 3.33 percent.
Sectoral Trends
From all sectors trading in the red in the morning, only three sectoral indices down in the afternoon session. Nifty oil & gas, FMCG and auto sectors led the charge, clocking gains of up to a percent.
Also Read | Fed to give fresh clues on path of interest-rate cuts
Fundamental View
The Nifty corrected more than a percent in the previous session even though institutions were big buyers.
Domestic institutional investors (DIIs) bought shares worth Rs 7,449 crore and FIIs’ Rs 1,421 crore. TCS bulk sales by Tata Sons clouded the institutional activity.
"But the important point is that there has been profit-booking by HNIs and retail investors, which pulled the market down. SEBI’s warning about elevated valuations in the broader market has played a role in this profit-booking," said VK Vijayakumar, Chief Investment Strategist, Geojit Financial Services.
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Investors would be eyeing US Federal Reserve’s rate decision, expected later in the day, for cues. The Fed commentary, which would decide the trend in the mother market US, would be closely tracked, he said.
According to Bloomberg, the American central bank will likely avoid signaling an imminent rate cut, staying focused on stubborn inflation while keeping one eye on a slowly rising jobless rate.
The Federal Open Market Committee is poised to keep rates in a range of 5.25 percent to 5.5 percent, a two-decade high first reached in July.
Fed officials are reluctant to lower borrowing costs until they’re certain inflation is closing in on 2 percent, the rate they see as appropriate for a healthy economy. But a recent rise in the unemployment rate to a two-year high means they’ll need to balance their attention on both prices and the labor market, the Bloomberg report said.
Technical View
After a gap-up opening, the Nifty can find support at 21,800 followed by 21,750 and 21,700. On the higher side, 21,900 can be the immediate resistance followed by 21,950 and 22,000, Deven Mehata, Research Analyst, Choice Broking, said.
Key Nifty gainers
Eicher Motors, Maruti Suzuki, Nestle India, Bajaj Finance and Bajaj Auto
Key Nifty losers
Tata Motors, Hindalco, Tata Consumer, Tata Steel and UPL
Key Sensex gainers
Maruti Suzuki, Nestle India, Bajaj Finance, IndusInd Bank and Power Grid
Key Sensex losers
Tata Motors, Tata Steel, Sun Pharma, HDFC Bank and NTPC
Stock moves
Aurobindo Pharma: The share rose nearly 2 percent in the early trade after the company received US Food and Drug Administration (USFDA) approval for nasal spray.
Eicher Motors: The scrip gained over 4 percent in the morning trade after brokerage UBS upgraded the rating to “buy” with 35 percent upside, citing new launches and peers’ lacklustre performance.
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