Closing Bell Updates: Sensex jumps 700 points, Nifty ends above 17,200; FMCG stocks rally

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Short covering backed with fear of missing out (FOMO) ruled traders’ mindset. After a hesitant gap-up open, the benchmark Nifty staged a further smart recovery amidst bargain hunting backed by short covering. The positive takeaway was that Nifty ended above its 200-DMA as HUL led from the front, up 4.40% as the street feels HUL is relatively better placed to fight the inflation woes. Reliance Industries too was star performer scaling fresh record high at Rs 2851. Nifty bulls will aim to carry forward the positive baton to tomorrow’s trading session and hopefully to next week’s trade with immediate goal post at 17607 and then at psychological 18000 mark. Technically speaking, the ongoing massive short covering shall continue as long as Nifty’s 17807-17000 support zone holds.

The company approved the proposal for buyback of up to 1,60,000 fully paid up equity shares of the Company having a face value of Rs 10 per equity shares and such buyback from all shareholders / beneficial owners of the equity shares of the Company, including promoters and members of the promoter group, on a proportionate basis as on the Record Date through the “Tender Offer” route, using mechanism for acquisition of shares through
stock exchange. It also recommended a final dividend of Rs 2 per equity share of face value of Rs 10 each for the financial year 2021-22 (20% of the face value), subject to the approval of the shareholders. The stock ended at Rs Rs 4,890.05, up Rs 52.75, or 1.09 percent. It has touched an intraday high of Rs 4,978.40 and an intraday low of Rs 4,788.60.

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A smart pullback rally on the last day of April F&O expiry series helped the markets rebound amidst wild intra-day gyrations during the week. Volatility is beginning to be the new normal for investors as haze over rising inflation, possible interest rate hikes and fluctuating oil prices have kept equity as an asset class in tight leash. If the trend continues, investors may have to brace for more volatility in the new F&O series as well. The Nifty took support near 17070 and bounced back sharply thereafter. The index has re-claimed the level of the 200 day SMA and has also formed a long bullish candle on daily charts, which is indicating the continuation of an uptrend formation in the near future.

For the trend following traders, now the 200-day SMA or 17200 would act as a trend decider level. And above the same, the Nifty could rally till 17400-17450. On the flip side, below 17200, uptrend could be vulnerable and a strong possibility of quick intraday correction till 17100-17050 is not ruled out.

Sensex surges 700 points, Nifty tops 17,200 | Five factors that aided bulls today

Index heavyweight Reliance Industries was a major contributor to the market rally as the stock hit a fresh record high of Rs 2,851 and became the most valued listed entity in India with market…

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Investors preference is shifting to safe-haven assets due to volatile equity market and global uncertainties indicated by rising US Dollar index. FPIs are in a selling mode while domestic investors are positive and will focus on defensives like Consumption and domestic growth sectors like Infra & capital goods. Volatility is expected to continue in the short-term due to weakening global trade and we suggest investors to have rationale expectations focusing on domestic growth sectors like CAPEX, banking and defensives.

Net profit went down 4.8% at Rs 7,261 crore against Rs 7,629 crore (YoY). Revenue was up 41.1% at Rs 39,342 crore against Rs 27,874 crore (YoY).

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Bank nifty index witnessed some buying from the lower levels on the last expiry of the month. However, the index is still trading below its 200-DMA which is placed at the 36800 level. In order to resume the uptrend, the index has to cross its 200-DMA with volumes. The lower-end support stands at 35800-35700 zone and a breach below this will lead to a fresh round of selling pressure.

Rupee ends at 76.48 per US dollar against April 28 close of 76.53 per US dollar.

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Even as the Euro hit a 5-year low against the dollar, benchmark indices on D-Street rose almost 2% in afternoon trade before giving up some gains powered by energy & FMCG stocks with Reliance becoming the first Indian company to cross m-cap of $250bn. Even standalone refineries not part of the Energy Index evinced keen interest on the back of rising gross refining margins. High quality midcap names in IT & Agri saw accumulation on the back of good earnings.