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Taking Stock: Market gains nearly 2% on positive cues; IT, metal shine

Bajaj Finance, Bajaj Finserv, Kotak Mahindra Bank, IndusInd Bank and SBI Life Insurance were among the top Nifty gainers. The losers included Shree Cements, Bharti Airtel, UltraTech Cement, Cipla and Bajaj Auto

July 28, 2022 / 04:57 PM IST

The Indian equity market extended gains for the second day on July 28 on positive global cues with the US Federal Reserve going for the expected 75 bps rate hike and buying across the sectors.

At close, the Sensex was up 1,041.47 points, or 1.87 percent, at 56,857.79, and the Nifty was up 287.80 points, or 1.73 percent, at 16,929.60.

"Positive cues from global markets following the Fed policy outcome as well as domestic largecaps’ upbeat earnings, drove the market rally, Vinod Nair, Head of Research at Geojit Financial Services, said.

The Fed's decision was as expected, while its comments dismissing the possibility of a recession and hinting at a slower pace of rate hikes boosted global sentiments, he said.

"As a result, the Indian rupee strengthened, potentially attracting foreign funds into the domestic market. Domestic investors are now bracing for the RBI's MPC meeting next week expecting a rate hike by 25-50 basis points," Nair added.

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Also Read: Sensex, Nifty up 1 percent each, 4 factors fuelling the market rally

Bajaj Finance, Bajaj Finserv, Kotak Mahindra Bank, IndusInd Bank and SBI Life Insurance were among the major gainers on the Nifty. The losers included Shree Cements, Bharti Airtel, UltraTech Cement, Cipla and Bajaj Auto.

Among sectors, Nifty bank, IT, metal, and energy indices gained 1-2 percent.

"… the tone of Fed’s chairman was less hawkish compared to the previous statement which receded some fears and uplifted the sentiments," said Siddhartha Khemka, Head-Retail Research, Motilal Oswal Financial Services.

Going ahead, the rate hikes would be more data-driven and determined by inflation. The Fed chairman also brushed aside the fear of a US recession.

It should have a positive rub-off on the RBI, which may slow down its aggression and go for a 25bps hike in the next meeting," he added.

Also Read: Sensex, Nifty gain 5 percent in July as rate hike fears ease, commodities soften, FIIs return

Stocks and sectors

On the BSE, all sectoral indices ended in the green with bank, IT, metal, power and realty were up 1-2 percent.

The BSE midcap index added nearly 1 percent and the smallcap rose 0.6 percent.

A long build-up was seen in Bajaj Finance, Bajaj Finseve and Mindtree, while a short build-up was seen in Biocon, Dixon Technologies and Shree Cements.

Among individual stocks, a volume spike of more than 100 percent was seen in Indiabulls Housing Finance, Delta Corp and Jubilant FoodWorks.

More than 100 stocks touched their 52-week highs on the BSE, including PVR, Inox Leisure, Navin Fluorine International, Timken India, ITC and Coromandel International.

Outlook for July 29

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

With a gap-up opening, the Nifty crossed the swing high of around 16,750 and went on to cross the June high of about 16,800. The bulls maintained an upper hand throughout the day, thus 16,750-16,800 becomes the near-term support zone.

As long as the index trades above this zone, it can march higher towards 17,000, where there is a 61.8 percent retracement of the April–June decline and the 200-DMA.

If the bulls manage to take out 17,000, then the index can stretch towards 17,200 in the short term

Rupak De, Senior Technical Analyst, LKP Securities

The Nifty has moved above its previous swing high, suggesting a rising bullishness. Besides, a bullish crossover of short-term moving averages will likely provide tailwinds to the index over the short term.

On the higher end, resistance is at 17,000 and 17,200, whereas on the lower end, support is visible at 16,700.

Disclaimer: The views and investment tips expressed by experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Rakesh Patil
first published: Jul 28, 2022 04:56 pm
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