Closing Bell: Nifty around 18,250, Sensex up 274 points; PSU banks shine

Benchmark indices broke a 3 days losing streak and closed in green with Nifty 50 closing +0.46% and Sensex closing +0.45% led by strong buying in PSU banks. Some selling pressure was witnessed in power and realty names.

IndusInd Bank and JSW steel were the top gainers while BPCL and Nestle were the top losers in Nifty 50 today. INR also edges up after 4 day continuous decline.

Overall we believe that Indian markets are trading in a positive trend backed by strong corporate earnings, easing supply constraints, cooling commodity prices and strong demand across various sectors. Investors should use any significant dip as a strong opportunity to buy in these markets.

On the technical front, immediate support and resistance in Nifty 50 are 18000 and 18400 respectively. Immediate support and resistance in Bank Nifty are 41950 and 43000 respectively.

The Nifty has stepped into a short term consolidation & the overall structure shows that the consolidation is here to stay for the next 1-2 weeks. Within this consolidation, the Nifty is expected to witness swings in both the directions.

In the last couple of sessions, it had formed the first leg on the downside & had reached near the 20 DMA. Consequently, the Nifty went for a bounce back today, which can take the Nifty to the hourly upper Bollinger Band, which is near 18300.

Over there, the index is likely to attract selling pressure again. Overall, short term consolidation is expected in the range of 18000-18450.

Uncertainties in regard to tighter monetary policy in the US and rising COVID-19 cases in China have been weighing on our domestic Indices. Against such backdrop, the benchmark index opened the day with minor gains and in the process, Nifty reached the lower end of the gap area coinciding with the 20-DMA and yesterday’s low, witnessing buying interest and it closed the day with a gain of 0.46% at 18244.

Though the crucial support level for the market continues to remain at the psychological level of 18000-18040.

In the broader market, the S&P BSE Mid-Cap index rose 0.45% while the S&P BSE Small-Cap Index shed 0.12%. On the BSE, 1,649 shares rose, and 1807 shares fell while a total of 152 shares were unchanged. PSU Banks, Metal, and IT stocks were in demand while Realty and Energy shares corrected.

Despite a sluggish start, indices recovered to end with smart gains, mainly aided by a recovery in European markets. With two days to go for the monthly expiry to end, short covering came into play which rescued the markets. Globally, Chinese lockdown, rising interest rates and slowing demand will continue to weigh on the markets in the near to medium term.

Technically, after a three days price correction, the Nifty found support around 18150 and also formed a small bullish candle on daily charts. The 10-day SMA (Simple Moving Average) of 18272 would be the immediate hurdle for bulls. Above the 10-day SMA level of 18272 the index could move to 18370 and further upside could lift it to 18420.

After three days of risk aversion, the domestic market experienced a relief rally in response to a bullish trend in global markets.

The tight COVID lockdown in China, however, has negatively impacted the forecast for global growth. FII interest has also reduced significantly as a result of the increased likelihood of stricter Fed policies.

Nifty started flat following global peers and moved up higher by the end of the session. On the higher end, it moved back above
18200.

A bullish harami pattern on the daily chart suggests a recovery in the term. The trend looks sideways to positive.

Going forward, 18200 may provide immediate support below which the index may drift down towards 18100. On the higher end, resistance is visible at 18300/18450.

Indian rupee closed 17 paise higher at 81.67 per dollar against previous close of 81.84.

: Benchmark indices broke three-day losing streak and ended higher with Nifty around 18,250.

At Close, the Sensex was up 274.12 points or 0.45% at 61,418.96, and the Nifty was up 84.20 points or 0.46% at 18,244.20. About 1587 shares have advanced, 1772 shares declined, and 140 shares are unchanged.

IndusInd Bank, NTPC, JSW Steel, HDFC Life and UltraTech Cement were among the biggest Nifty gainers, while losers were BPCL, Nestle India, Bharti Airtel, Power Grid Corporation and Kotak Mahindra Bank.

PSU Bank index up 1.6 percent, while power, realty down 1 percent each.

The BSE midcap up 0.5 percent, while smallcap index ended flat.

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NHPC was quoting at Rs 41.90, up Rs 0.15, or 0.36 percent on the BSE.

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Infosys was quoting at Rs 1,586.85, up Rs 19.65, or 1.25 percent.

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