Taking Stock: Nifty around 19,400; Sensex up 267 points; power, realty and metals shine

All the sectoral indices were trading in the green with information technology, realty, metal, power and capital goods up 1-2 percent.

The BSE midcap and smallcap indices added nearly a percent each.

A long build-up was seen in Tata Power Company, GMR Airports Infrastructure and Dixon Technologies, while a short build-up was seen in Vodafone Idea, Reliance Industries and Exide Industries.

Among individual stocks, a volume spike of more than 100 percent was seen in Tata Power Company, Metropolis Healthcare and Chambal Fertilisers and Chemicals

More than 200 stocks touched their 52-week high on the BSE, Usha Martin, Thermax, Tribhovandas Bhimji Zaveri, REC, Praj Industries, Karnataka Bank, Jyothy Labs, Jammu & Kashmir Bank, GMR Airports Infrastructure, Gabriel India, CG Power and Industrial Solutions, DB Realty and Bharat Forge.

Outlook for August 22

Jatin Gedia – Technical Research Analyst at Sharekhan by BNP Paribas:

The Nifty witnessed yet another range-bound day of trade. It snapped the two-day losing streak and closed in the positive up ~83 points. On the daily charts, we can observe that the Nifty has been hovering around the 40-day moving average (19360) for the past five trading sessions. Considering that the Nifty has been falling for the last four weeks a pullback is likely.

On the hourly charts, we can observe positive divergence indicating that momentum is weakening on the downside. However, we shall await further confirmations on the price front to change our short-term outlook. Until the Nifty trades below 19480 – 19500, we can expect the weakness to continue, and we shall continue to maintain our negative outlook on the index. On the downside, we expect the Nifty to target levels of 19100. Crucial support is placed at 19280 – 19240 while immediate hurdle is placed at 19480 – 19500.

Bank Nifty has also witnessed a pullback and snapped the seven-day losing streak. It has closed in the green and more importantly, holding on to the support of the 20-week moving average (44000) which indicates that a pullback is likely in the short term. The pullback can last till the 44400 – 44500 zone.

Ajit Mishra, SVP - Technical Research, Religare Broking:

Markets started the week with an uptick and gained nearly half a percent. After the initial choppiness, Nifty maintained a positive tone for most of the session however profit taking in the end trimmed some gains. Eventually, it settled at 19383.60 levels; up by 0.43%. Meanwhile, the tone was mixed on the sectoral front wherein the metal and IT posted decent gains while auto and banking traded dull. The broader indices also participated in the move as both midcap and smallcap rose in the range of 0.6%-0.9%.

Participants shouldn’t read much into intermediate rebound or a pause until Nifty decisively reclaims 19650 levels or forms a reversal pattern. And, we recommend continuing with stock-specific trading approach and maintaining a focus on risk management.

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