Closing Bell: Nifty ends around 18,400, Sensex gains 318 pts; realty index up 4%

Taking Stock: Market at 5-month high with Nifty around 18,400; Sensex gains 318 points

Hero MotoCorp, Tata Motors, ITC, Tech Mahindra and HUL were among the top gainers on the Nifty, while losers were Adani Enterprises, Cipla, BPCL, Divis Labs and Grasim Industries.... Read More

Benchmarks were positive for a major part of the trading session where Nifty closed a tad below the psychological 18,400 mark. As long as Nifty’s 18,213 support is held, expect the index to bounce towards its psychological hurdle at 18500 mark and then aggressive targets at its all-time-high at 18,888 mark.

A cheerful mood was prevalent at Dalal Street in today’s trade as Nifty ended the day in green and the positive takeaway was that the optimistic baton witnessed a breakout above its previous week’s consolidation range.

The Nifty index continues to find a strong support near 18,350 levels and post that Index continued to trade in a higher high higher low formation through the day and closed 84 points higher at 18,399 levels with 0.46% gains.

Overall, it was an optimistic day as Nifty bulls enjoyed a bullish session as 35 out of 50 stocks closed in green. The momentum oscillator RSI (14) on the daily chart has taken support near 55 levels and shown a strong reversal with a bullish crossover on the cards.

The validity of the bullish pattern stands above 18,200 – 18,150 levels, if in case the frontline index closes below these levels then the gate is wide open till 18,000 – 17,900 levels. On the higher end, resistance is capped at 18,500 - 18,550 levels. A break of that levels will trigger a buy signal towards 18,700 levels or even higher.

Positive Asian and European market cues coupled with a further drop in wholesale inflation numbers fuelled a major rally as realty shares attracted significant buying interest. India's macroeconomic performance is showing further signs of improvement, and this is providing a major fillip to the markets.

Technically, the Nifty cleared the short term resistance of 18,400 but intraday profit booking at higher levels saw it close below 18,400. For the trend following traders now 18,300 would act as a sacrosanct support zone and above the same the positive momentum is likely to continue. Above which, the index could retest the level of 18,450.

Further upside may also continue which could lift the index till 18,550. On the flip side, below 18,300, the uptrend would be vulnerable and below the same, we may see a quick correction till 18,200-18,150.

Markets started the week on a firm note and gained nearly half a percent amid mixed cues. After the flat start, the Nifty index inched gradually higher as the day progressed however profit taking in the final hour trimmed the gains. Consequently, it settled at 18,398 levels; up by 0.46%. Most sectors participated in the up move wherein realty, FMCG and banking were among the top contributors. The broader indices also witnessed decent traction and gained nearly a percent each.

The rotational buying in heavyweights from the key sectors viz. Banking, financial, auto and FMCG is helping the index to maintain a positive tone despite mixed global cues. And, indications are in favor of the prevailing trend to continue. Traders should align their positions accordingly and avoid contrarian trades.

Domestic benchmark indices are marching ahead driven by favourable developments such as declining inflation levels, steady foreign inflows, and in anticipation of robust earnings growth on a QoQ basis next quarter, due to drop in global commodity prices.

The domestic CPI inflation came in better than expected at 4.7%, and the WPI inflation decreased by 0.92%, reaffirming RBI’s decision to hold rate hikes.

The Nifty has finally managed to close above the upper boundary level of 18,350 which indicates breakout from a sideways consolidation range. The breakout has put the structure in favor of bulls. The index is likely to witness continuation of the positive momentum.

The ideal strategy to trade such a kind of scenario is to ride the uptrend with a trailing stoploss mechanism. On the upside, we expect the Nifty to reach levels of 18,500 and hence we change our outlook on the Nifty to positive from sideways.

The daily momentum indicator has triggered a negative crossover which is a sell signal, however, until price shows up evidence of the same, we shall continue to maintain a positive outlook.

In terms of levels, 18,500 – 18,520 is the immediate hurdle while 18,190 – 18,220 shall act as a crucial support zone and until this support zone is held, we can expect the dips to be bought into and the positive momentum to continue.

Indian rupee closed 14 paise lower at 82.30 per dollar against Friday's close of 82.16.

: Indian benchmark indices ended on a positive note with Nifty around 18,400.

At close, the Sensex was up 317.81 points or 0.51 percent at 62,345.71, and the Nifty was up 84 points or 0.46percentat 18,398.80. About 1,861 shares advanced, 1,680 shares declined, and 167 shares wereunchanged.

Hero MotoCorp, Tata Motors, ITC, Tech Mahindra and HUL were among the top gainers on the Nifty, while losers were Adani Enterprises, Cipla, BPCL, Divis Labs and Grasim Industries.

Except for power, all other sectoral indices ended in the green with the realty index up over 4 percent, FMCG and PSU Bank indices up 1 percent each, while bank, auto, capital goods, information technology and metal up 0.5 percent each.

BSE midcap and smallcap indices rose 0.5 percent each.

USDINR CMP- 82.36 (spot) Indian Rupee depreciated today on a strong Dollar. However, FII inflows and weak crude oil prices cushioned the downside. Macroeconomic data from India was mixed. India’s consumer inflation declined to an 18-month low at 4.7% in April 2023 as compared to 5.66% in March 2023. However, India’s industrial production increased by 1.1% in March 2023, at a slower pace as compared to 5.6% in February 2023. India’s WPI declined to -0.92% in April as compared to 1.34% in the previous month. US Dollar gained on safe haven demand amid worries over debt ceiling crisis.

We expect Rupee to trade with a negative bias on risk-off sentiments on the back of the debt ceiling crisis and a strong Dollar. However, weak crude oil prices and foreign inflows may support Rupee at lower levels.

Traders may remain cautious ahead of India’s trade deficit and Empire State manufacturing index from US. Investors may watch out for retail sales data from US later this week. We expect USDINR spot to trade in between 81.80 to 82.75 in the near term.

-Underweight rating, target at Rs 220 per share
-Core earnings in-line with integrated margin back to mid-cycle run rate
-However, for FY23 the company reported its first ever full-year loss of Rs 7,300 crore
-Could see street shifting valuations from lower P/E to higher SOTP-based valuations

Hindustan Petroleum Corporation has touched a 52-week high of Rs 267.40 and was quoting at Rs 259.70, down Rs 1.15, or 0.44 percent on the BSE.

Gold prices traded up on Monday, with spot gold price at Comex trading higher by 0.19percentat USD2023 per ounce. Gold Junefuture contract at MCX was trading up by 0.24 percentat Rs 61035 per 10 grams by the noon session.

Gold prices resumed trading on a positive note as safe-haven demand amid mounting fears over the US debt-ceiling crisis and banking sector crisis. In the previous week Comex spot gold price declined by 0.30% and settled at USD 2010.0 per ounce as a rally in the US dollar and lack of follow-up buying near the resistance level pushed the price lower. On the investment front, holdings in gold-backed ETF funds expanded to the highest in six months last week.

We expect bias to remain positive on Gold on the back of safe haven buying as ongoing concern about the US debt-ceiling crisis. For the week Comex spot gold has resistances at USD 2035/2060 per ounce and supports at USD 2010/1980 per ounce. MCX Gold June future has supports at Rs 60525/60300 per 10 grams and resistances at Rs 61400/61850 per 10 grams.