Closing Bell: Nifty ends near 16,800, Sensex gains 388 pts led by power, metal, oil & gas stocks

Taking Stock | Market ends higher on another volatile day, metals shine

Broader indices performed in line with the benchmarks, with BSE midcap and Smallcap indices adding 0.8 percent each

It was a highly volatile session and benchmark indices gyrated sharply before ending higher despite lingering woes over the ongoing Russia-Ukraine battle. For India, rising crude oil prices has been a major worry, which will increase the oil import bill and subsequently trigger a spike in inflation going ahead.

Technically, the Nifty has formed a long bullish candle which is broadly positive. Currently the market is hovering between 16500-16750 price ranges. In the last hour of trade, it cleared the resistance of 16750 but it would be interesting to see whether the index would be able to hold on to the level.

For the traders, 16600 would be the immediate support level to watch out and above the same the index could continue the momentum till 16850-16950. However, a dismissal of 16600 could possibly trigger one more correction wave till 16500-16350.

The Nifty opened gap down on February 28 only to attract fresh buying support near 16400-16350. Thereon the index witnessed recovery throughout the day. On the upside, it tested the crucial barrier of 16800, which restricted the upside for the day.

The level of 16800 was earlier acting as a crucial support & has now changed its role to that of a resistance. Unless that level gets taken out on a closing basis the index can witness a consolidation in the short term.

On the other hand, once 16800 is crossed on a closing basis then the index can attempt a larger bounce towards 17200.

Aggravated Russia-Ukraine conflict along with fresh sanctions on Russia by global powers weighed on Western markets. Despite opening on a negative tone, domestic indices staged a strong recovery lifted by metal stocks and positive Asian markets.

Metal stocks rallied on hopes that curtailing Russian exports would help Indian steelmakers to capture the export market share.

Domestic investors are keenly awaiting the release of the Q3 GDP data later today which is forecasted at 6.5% against 8.4% in Q2.

The recovery continues in Nifty as 16550 level was not broken decisively. On the higher end the index value crossed beyond the initial resistance 16750.

The momentum may continue till 16930-17000 where once again the Nifty may face selling pressure. On the lower end, support lies at 16750/16600.

Technically, the Nifty index has formed a long green candle and sustained above the Lower Bollinger Band formation but still trading below the 200-Days SMA. Moreover, on an hourly chart, the index shifted above 21-SMA, which suggests further recovery.

A momentum indicator RSI has pulled up from the oversold zone & Stochastic witnessed a positive crossover, which indicates short covering for the near term.

At present, Nifty has immediate support around 16650/16500 levels, while on upside the resistance around 17000 levels. On the other hand, Bank Nifty has support at 35500 levels while resistance at 36800 levels.

Benchmark indices ended on positive note for the second consecutive day on February 28 amid buying seen in the metal, oil & gas, power and IT stocks.

At close, the Sensex was up 388.76 points or 0.70% at 56,247.28, and the Nifty was up 135.50 points or 0.81% at 16,793.90. About 2071 shares have advanced, 1290 shares declined, and 142 shares are unchanged.

Hindalco Industries, Tata Steel, Power Grid Corporation, JSW Steel and BPCL were among gainers on the Nifty, while losers included HDFC Life, Dr Reddy's Labs, M&M, Axis Bank and HDFC Bank.

Among sectors, except auto and bank all other sectoral indices ended in the green. BSE midcap and smallcap indices are up 0.8 percent each.

The broking house CLSA has kept a buy rating on Bharti Airtel with a target at Rs 915 per share.

The deal is divergent to Bharti’s long-term strategy of monetising tower assets.

The key driver for Bharti’s stock remains the India mobile business.

Bharti Airtel was quoting at Rs 686.55, down Rs 1.90, or 0.28 percent on the BSE.

The research firm Citi has maintained a buy rating on Bharti Airtel with a target at Rs 875 per share.

Bharti providing exit to Vodafone should enable Vodafone Idea to complete its capital raise and it protect value of Bharti’s holding in Indus.

The additional allocation of capital by Bharti is unlikely to enthuse investors, while attractive acquisition price offers potential for a meaningful return over long term.

Bharti Airtel was quoting at Rs 687.20, down Rs 1.25, or 0.18 percent on the BSE.

Oil prices jumped on Monday as Western allies imposed more sanctions on Russia and blocked some Russian banks from a global payments system, which could cause severe disruption to its oil exports.

Brent crude rose $4.16, or 4.3%, to $102.09, at 0915 after hitting a high of $105.07 a barrel in early trade.

The Brent contract, for April delivery, expires on Monday. The most active contract, for May delivery, was up $4.16 at $98.28.

U.S. West Texas Intermediate (WTI) crude was up $4.19, or 4.6%, at $95.78 a barrel after hitting $99.10 in early trade.