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Taking Stock: Sensex up 379 points, Nifty above 17,800 as rally continues

Broader indices outperformed the benchmarks, with the BSE midcap and smallcap indices rising a percent each

August 16, 2022 / 04:48 PM IST

The Indian equity market carried forward the gains of the previous week, with buying across sectors, barring metal and PSU bank, and a drop in wholesale prices boosting sentiment on August 16.

At close, the Sensex was up 379.43 points or 0.64 percent at 59,842.21, and the Nifty was up 127.10 points or 0.72 percent at 17,825.30.

"The easing of inflationary pressures has encouraged domestic investors to remain optimistic about the pace of economic recovery. Better-than-expected CPI numbers, aided by a slower increase in food and fuel prices, may limit the pace of rate hikes by the RBI," said Vinod Nair, Head of Research at Geojit Financial Services

The Wholesale Price Index (WPI) dropped to 13.93 percent in July, the lowest in five months, data released by the government showed .

"In the Asian market, the Chinese central bank surprised the market by cutting its interest rates after a weak set of economic data. Following that, oil prices slumped on demand worries," Nair added.

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HDFC Life, Adani Ports, Eicher Motors, BPCL and Maruti Suzuki were among the major Nifty gainers.

The losers included Grasim Industries, Hindalco Industries, SBI, Bharti Airtel and JSW Steel.

On the sectoral front, the Nifty auto index rose 2.5 percent, energy and FMCG indices added a percent each and Nifty bank, metal and pharma were up 0.5 percent each.

Stocks and sectors

On the BSE, except metal, all sectoral indices ended in the green. Auto and realty indices added 2 percent each. Oil & gas, power and FMCG rose 1 percent each.

The broader indices outperformed the benchmarks. BSE midcap and smallcap indices rose a percent each.

A long build-up was seen in HDFC AMC, Apollo Tyres and Escorts, while a short build-up was witnessed in Muthoot Finance, Manappuram Finance and Metropolis Healthcare.

Among individual stocks, a more than 400 percent volume spike was seen in Godrej Consumer Products, Escorts and Honeywell Automation India.

TVS Motor Company, Tata Elxsi, Siemens, Karur Vysya Bank, ICICI Bank, CG Power and Industrial Solutions and Bajaj Auto were among the more than 100 stocks to touch their 52-week highs on the BSE.

Outlook for August 17

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

The market maintained its upward bias aided by positive global cues and a few domestic factors that triggered a rally in realty, automobile and banking stocks.

Moderating inflation has raised hopes that interest the central bank may slow down the pace of rate hikes. A strong FII fund infusion bolstered the sentiment.

Technically, the Nifty has held the higher bottom formation on intraday charts and 17,750 would be the trend decider level. Above which, the index can hit 17,900-17,925.

On the flip side, a quick intraday correction is possible if the index trades below 17,750 and can slip to 17,700-17,650.

Rupak De, Senior Technical Analyst, LKP Securities

The Nifty has given a falling trend line breakout on the daily chart, suggesting a rise in optimism.

The momentum oscillator Relative Strength Index is in the overbought zone but no bearish crossover is visible in the indicator.

The trend will likely remain positive as long it remains above the falling trendline. Profit booking is possible if the index falls below the trend line.

Support on the lower end is at 17,700. On the higher end, resistance is seen at 18,000.

Ajit Mishra, VP-Research, Religare Broking

The market will continue to mirror global peers. Investors should stick to a stock-specific approach and also keep a close watch on fluctuating crude prices and currency movement.

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: Aug 16, 2022 04:48 pm
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