Sensex and Nifty were marginally up from the previous day's close in the second leg of the special trading session of May 18, with financial services and FMCG stocks leading the gains. All 13 major sectoral indices closed in green.
FMCG giant Nestle India's shares ended 2.4 percent higher after a majority of the shareholders voted against an increase in royalty payout to Swiss parent Nestle S.A.
Compared to the close on May 17, Sensex was up 0.1 percent or 104 points at 74,021 and and Nifty 50 was up 0.2 percent or 35 points at 22,501. In the broader market, both BSE Midcap was up 0.5 percent and BSE Smallcap gained 0.8 percent.
"Although the mixed performance among major stocks is limiting momentum in the index, the broader market's strength and gains in select heavyweights are providing ample opportunities," said Ajit Mishra – SVP, Research, Religare Broking. "Participants should adjust their positions accordingly and maintain a 'buy on dips' strategy," Mishra said.
Deven Mehta, Research Analyst at Choice Broking advised traders to evaluate the support of 22,400 and resistance of 22,550 and trade with a strict stop loss.
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With India VIX easing the prospects of 22,720-22,850 have improved, said Anand James, Chief Market Strategist at Geojit Financial Services. James said that a pullback below 22,480 could ease the momentum, but an upside trajectory would be in play as long as 22,400 holds. The volatility gauge was up 3.4 percent today at 20.5.
A slippage below 22,400 could call for 22,350-22,227 levels. However, a collapse beyond these levels is less likely, James added.
Technical indicators, foreign investors’ buying, and US market strength show that Indian benchmark indices may find support for a further rise in the near term.
Also Read: Nestle India's majority shareholders vote against proposed hike in royalty payout to parent
In the domestic market, there is an extreme eagerness to know the outcome of the general elections, and this emanates from the need to know the possibility of continuity of policies, said Jaykrishna Gandhi, Head - Business Development, Institutional Equities, Emkay Global Financial Services. "Certainty regarding this would help the markets to sail more smoothly, and it will have to wait till the first week of June," said Gandhi.
Meanwhile, Osho Krishan, Senior Analyst - Technical & Derivative Research, Angel One pointed out that major heavyweight Nifty Bank still lacks conviction. He said that the participation of Nifty Bank is crucial to strengthening momentum in the upcoming week.
In the first special trading session held from 9:15 am to 10:00 am on May 18, Sensex and Nifty ended flat with all 13 major sectoral indices closing in green.
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