Closing Bell: Nifty ends around 18,200, Sensex up 223 pts on expiry day; metals shine

The Bank Nifty bulls came back strong and smashed the bears with full force surpassing the hurdle of 43,000. The index remains in a buy mode and any dip should be an ideal opportunity to initiate long positions with immediate support at the 42,700-42,400 zone.

The momentum indicators are in the strong buying zone and the index is likely to head higher toward 44,000-45,000 zone levels.

Markets traded volatile on the monthly expiry day and ended marginally higher amid mixed signals. After the gap-down start, the first half was dull as the Nifty index hovered in a narrow band however a sharp surge in the index majors in the latter half completely changed the tone. Consequently, it settled around the day’s high to close at 18,191 levels.

Meanwhile, the sectoral indices witnessed a mixed trend wherein the metal and banking pack posted decent gains. The broader indices underperformed the benchmark and ended marginally in the green.

Markets may attempt to extend the rebound on the last trading day of the calendar year however mixed global cues could cap the upside. Besides, the existence of a hurdle around 18,350 in Nifty is added negative. We thus reiterate our view to continue with stock-specific trading approach and maintain positions on both sides until we get clarity over the directional move in the index.

Markets shrugged off intra-day volatility as last hour buying helped key indices end in the green. Investors covered their positions on the last day of the December monthly expiry, fuelling an upsurge in metals, banking and oil & gas shares on hopes of a demand revival after China lifted Covid-related restrictions.

But sideways movement will continue going ahead as recessionary fears in the West continue to loom large in view of more likely rate hikes and tempered growth going ahead. Technically, Nifty took support near 18,000 and bounced back sharply.

A bullish candle on daily charts and higher bottom formation on intraday charts is indicating further uptrend from the current levels. For bulls, 18,000 would act as a sacrosanct support zone, and above the same it could move up till 18,280. In case of further upside the index could move up to 18,400.

On the flip side, below 18,000 traders may prefer to exit out from the trading long positions and below the same the index could slip till 17,900.

The domestic market trend was influenced by the movements of its global counterparts, as a negative US closing pushed Indian bourses to a poor start. However, positive signals from US futures lifted the benchmark index above the flatline.

Markets will continue to witness such sudden movements, underpinned by lingering recession and COVID fears, which will be countered by bargain hunters.

The Nifty opened gap down & moved lower towards the level of 18000. The index witnessed base formation near the key psychological mark in the first half of the session & had a smart recovery in the second half. Consequently, the index has formed a bullish outside bar & an Engulfing bull candle on the daily chart.

On the way up, the index surpassed a falling trendline on the hourly chart & reached near the rising trendline, which was broken on the downside on Friday last week. It has also tested the 40 DEMA on the upside. Thus the Nifty has halted near a very crucial area.

If the index crosses the level of 18,200 & sustains in the higher territory then it can march towards 18,400 in the short term. On the other hand, the level of 18,000 will continue to provide cushion on the downside.

Indian rupee ended marginally higher at 82.80 per dollar on Thursday versus previous close of 82.86.

Benchmark indices ended higher in the volatile session amid volatility on December expiry day.

At Close, the Sensex was up 223.60 points or 0.37% at 61,133.88, and the Nifty was up 68.50 points or 0.38% at 18,191.00. About 1821 shares have advanced, 1555 shares declined, and 140 shares are unchanged.

Bharti Airtel, Eicher Motors, SBI, Tata Steel and IndusInd Bank were among the biggest Nifty gainers, however, losers included Apollo Hospitals, Tata Motors, Divis Laboratories, Titan Company and UltraTech Cement.

Among sectors, bank, metal and oil & gas indices rose 1 percent each.

The BSE midcap and smallcap indices ended on flat note.

-Gas demand remains challenged with no material improvement
-Power, industrial & city gas shift to alternatives fuel
-Domestic gas market share grinds higher & was at 58 percent, highest in last decade
-Prefer GAIL & IGL, underweight on Petronet LNG

Emkay foresees Nifty at 19,500 and Sensex at 64,500 by December 2023

Expensive valuation is also a near-term headwind to Nifty’s performance. Current price-to-earning ratio of 19x is at a 11 percent premium to 10-year average, the brokerage noted... Read More