Closing Bell: Market ends marginally higher amid volatility; metals outshine, realty, bank drag

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Vishal Wagh, Research Head, Bonanza Portfolio:
 
Nifty had a volatile session amid weak global cues and weekly expiry. It closes above 18,250 as bulls maintain the momentum on Dalal Street. 
 
The index has once again given a flat to a marginal positive start in today's session. Volatility was visible owing to weekly expiry with wild swings on both sides. 

Going ahead 17,940 -18,000 will be good short-term support for upcoming trading sessions and on the upside 18,340 will act as new immediate resistance. 

A hammer candlestick pattern is visible on daily charts indicating that the steam is cooling off and we can see sideways or profit booking sessions in the coming days. The structure of the index is in favor of bulls. Market breadth has remained at 2:1 with 36 stocks on the advancing side & 14 stocks on the declining side.

Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities:

Markets extended gains for the fifth straight session, but it looks like bulls are showing signs of fatigue as trading largely remained rangebound. 

The Nifty has formed a Doji candlestick formation indicating indecisiveness between bulls and bears. However, the medium-term texture is still positive. 

Direction wise, below 18200 we can expect profit booking and post breakdown the chances of hitting 18140-18100 levels are bright. On the other hand, as long as the index is trading above 18200, the uptrend will continue till 18300-18350.

Prashant Tapse, Vice President (Research) at Mehta Equities:

Nifty’s ascent towards 18,605 is on the radar. Interestingly, the gains came despite US CPI surging to the highest level since June 1982 and core CPI registering the biggest advance since 1991. The stronger readings reinforce the need for quicker interest rate hikes by the Federal Reserve. 

Also, in a double whammy for the economy, India’s retail inflation rate shot up to a five month high in December and growth in factory output decelerated to a nine-month low in November. 

There is likely to be lots of opportunities on the buy side as long as Nifty stays above 17889 mark. The immediate goalpost on Nifty is seen at its all-time-high at 18605 mark.

Ajit Mishra, VP - Research, Religare Broking:

Markets consolidated in a narrow range and settled marginally higher, taking a breather after the recent surge. Initially, the upbeat start of the IT majors triggered a firm opening however profit taking in the banking space trimmed the gains in no time. 

The benchmark continued to trade lacklustre thereafter however movement in the metal and pharma space kept the traders’ busy. 

Consequently, the Nifty index ended at 18,257 levels; up by 0.25%. Amid all, the broader indices outperformed wherein both midcap and smallcap gained nearly 0.6% each.
 
The not so decisive move in the index combined with a dip in the banking space is pointing towards some consolidation. And, we feel it would be healthy, considering the surge from the December lows. However, there’ll be no shortage of trading opportunities, thanks to rotational buying across sectors. Participants should focus on metal and pharma along with select counters from chemical, sugar and power space for long positions.  
 

S Ranganathan, Head of Research at LKP securities:

Metals stole the show in today's trade with the metal index rising over 3.5% well supported by the pharma & PSE index. 

Sugar stocks were in demand on the back of Ethanol push and robust outlook in CY2022. Profit booking was seen in select cement & IT stocks in today's trade.

Gaurav Ratnaparkhi, Head of Technical Research, Sharekhan by BNP Paribas:

The Nifty opened gap up on January 13 post which it traded in a sideways manner & ultimately formed a Dragonfly Doji on the daily chart. This gives a warning that the rally can run out of the steam in the short term. The hourly momentum indicator continues to show negative divergence near the overbought zone that also shows that the index is losing momentum on the upside. 

The hourly chart shows that the index is trading near lower end of a rising channel, which is near 18160. Below that, a recent gap area of 18081 – 18128 will be the key support to watch out for. 

The short term trajectory can remain positive as long as the index trades above these supports & the Nifty can test its weekly upper Bollinger Band near 18400. On the other hand, breach of these supports will be an indication of exhaustion in the trend from short term perspective.

Sahaj Agrawal, Head of Research- Derivatives at Kotak Securities 
 
Nifty remains in an uptrend and is expected to test 19000-19500 levels going ahead. Any correction in the short term can be used to initiate fresh long positions. 

We remain positive on Metals and FMCG at current levels; Realty, IT, and Auto trade with positive bias but can be bought only on deeper corrections.

Manish Hathiramani, proprietary index trader and technical analyst, Deen Dayal Investments:

The Nifty has given a positive close above 18250. Ideally, the next target is 18500 with strong support at 17800. Any dip can be utilized to accumulate long positions on the index.

Vinod Nair, Head of Research at Geojit Financial Services: 

The domestic market traded between gains and losses weighing the initial positive earnings results and weak global cues. Globally, western markets traded lower due to 4-decade high inflation as the US consumer price index rose by 7% YoY in December. 

Owing to an unfavourable base effect, India’s retail inflation also jumped to 5.59% in December higher than RBI’s forecast of 5.1% for Q3FY22. India’s Industrial Production registered a subdued growth of 1.4% as supply shortage constrained factory production.

Market Close: Benchmark indices ended with marginal gains in the volatile session on January 13 with buying seen in the metal and pharma names.

At close, the Sensex was up 85.26 points or 0.14% at 61,235.30, and the Nifty was up 45.50 points or 0.25% at 18,257.80. About 1630 shares have advanced, 1609 shares declined, and 62 shares are unchanged.

Tata Steel, JSW Steel, Sun Pharma, Coal India and UPL were the top Nifty gainers. Losers were Wipro, Asian Paints, HDFC Bank, Kotak Mahindra Bank and IndusInd Bank.

On the sectoral front, metal, pharma, power, oil & gas and capital goods indices rose 1-3 percent, while bank and realty indices fell over 0.5 percent each. BSE midcap and smallcap indices ended in the green.

Credit Suisse view on Infosys

The research house has kept an outperform call on the stock and raised the target price to Rs 2,350 as it was a solid quarter with strong beat on revenue and net profit.

It has increased FY22/23/24 EPS estimates by 2 percent/4 percent/4.5 percent respectively.

Infosys was quoting at Rs 1,893, up Rs 15.40, or 0.82 percent on the BSE.