Nifty, Sensex hold gains as realty stocks soar; VIX rises 2%

HUL, Bharti Airtel, Tata Steel, Tech Mahindra, and Asian Paints.

The headline indices were off to a flying start on July 16 after the Nifty hit a fresh and the Sensex was points from a new high of its own. During mid-day, the two held on to the morning gains following a sharp rally in the realty sector ahead of the Union Budget due July 23.

At noon, the Sensex was up 0.12 percent at 80,763 and the Nifty was up 0.2 percent at 24,630. About 1,999 shares advanced, 1,336 shares declined, and 75 shares unchanged.

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The broader market -- midcap and smallcap index-- also rose 0.2 and 0.8 percent respectively. The two have been on a stellar run, rising xx and xx percent since the start of July. Analysts, however, suggest that the outperformance of headline indices could witness a pause after the budget as more money is likely to flow into large caps.

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The VIX also rose further, up 2 percent to be at around 14.5.

Sectoral Trend

Of the 13 indices, healthcare was the worst hit, slipping 0.3 percent followed by Pharma. Realty stocks were the brightest spark in the afternoon with the index rallying 2 percent. Counters like Prestige Estates, DLF, and Godrej Properties were the top gainers.

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Fundamental View

"In the next few days in the run-up to the Budget, the market is likely to anticipate the Budget proposals and respond. Even though Budget anticipations are speculative, this Budget will be growth-oriented and at the same time fiscally prudent," V K Vijayakumar, chief investment strategist at Geojit Financial Services, said.

"Growth is the top priority which the Government cannot and will not compromise. Tax buoyancy and the RBI dividend bonanza give the finance minister ample room for fiscal consolidation. Therefore, the market will be optimistic on this ground," he added.

Technical View

"The Nifty has been slowly and steadily gaining strength inching every day in the north direction and with the bias maintained strong, has the next initial target of 24,900 levels. With mid-cap and small-cap
stocks also participating actively, the undertone is maintained very positively and can carry on with the positive move further," Vaishali Parekh, vice president of technical research at Prabhudas Lilladher said. The support for the day is seen at 80,200 and 24,450 (Sensex and Nifty) levels while the resistance would be at 81,100 and 24,700 levels.

Key Nifty gainers

Coal India, BPCL, HUL, Tata Consumer Products, and Bharti Airtel.

Key Nifty losers

Kotak Mahindra Bank, Dr Reddy's Laboratories, Shriram Finance, UltraTech Cement, and SBI Life Insurance Company.

Key Sensex gainers

HUL, Bharti Airtel, Tata Steel, Tech Mahindra, and Asian Paints.

Key Sensex losers

Kotak Mahindra Bank, UltraTech Cement, Reliance Industries, Nestle India and Axis Bank.

Stock Moves

Bharti Hexacom: Shares surged 10 percent after global brokerage JPMorgan initiated coverage on the stock with an 'overweight' tag. The brokerage assigned a price target of Rs 1,280 for the stock, foreseeing a 20 percent upside potential from the previous closing level.

Century Textiles: Shares rallied 8 percent after its wholly-owned subsidiary- Birla Estates acquired a 5-acre land parcel in Gurugram. The land parcel offers a development potential of around 10 lakh square feet and is expected to generate revenue of over Rs 1,400 crore.

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