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Market jumps 2% on supportive cues, over 60 smallcaps jump 10-39%

The broader indices - BSE Midcap and Smallcap indices added 3.3 and 2 percent, respectively.

October 16, 2021 / 10:03 AM IST

Market continued the gaining momentum in the second consecutive week with benchmark indices rising to fresh record high supported by the positive cues.

In the last week, BSE Sensex rose 1,246.89 points (2.07 percent) to close at 61,305.95, while the Nifty50 rose 443.3 points (2.47 percent) to close at 18,338.5 levels.

The broader indices - BSE Midcap and Smallcap indices added 3.3 and 2 percent, respectively.

Among smallcaps, over 60 stocks rose between 10-39 percent including names like Borosil Renewables, GOCL Corporation, MSTC, Maharashtra Seamless, Network 18 Media & Investments, Inox Wind, Borosil, Swelect Energy Systems and Neuland Laboratories.

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On the other hand, SREI Infrastructure Finance, Chambal Fertilisers and Chemicals, Nureca, Bajaj Hindusthan Sugar, Shriram EPC, Nazara Technologies and BLS International Services fell 10-18 percent.

"Market continued its bull run as worries about the likely interest rate hike in the US at a later stage and rising bond yields tempered, while a good start to earnings season boosted sentiment," said Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities.

"In the case of benchmark Nifty, it has already rallied nearly 900 points this month and hence there is a strong possibility of temporary weakness. We are of the view that 18200 could be the trend decider level for positional traders and above the same the uptrend formation will continue up to 18500-18750 levels."

"On the flip side, dismissal of 18200 could trigger another correction wave up to 18100-18050 levels. Contra traders can take a long bet near 18050 with strict 18000 as support stop loss," he added.

In the last week, the BSE 500 index also added over 2 percent with IDBI Bank, Maharashtra Seamless, Tata Motors, Tata Motors - DVR, Network 18 Media & Investments, Tata Power Company and Avenue Supermarts rose 20-30 percent.

"In the case of the Nifty, the week gone by was dominated by the bulls right from the beginning till the end. The weekly chart shows that the index has broken out from an Inside bar pattern; which was formed in the penultimate week. On the way up, Nifty crossed the crucial psychological mark of 18000 & is now set to test 19000 on the upside from a short term perspective," said Gaurav Ratnaparkhi, Head of Technical Research, Sharekhan by BNP Paribas.

"The daily chart is showing a runaway gap, which underscores the underlying strength. The same is visible from the momentum indicators as well. Hence the index is expected to stay on the upward trajectory with the short term target at 19000. On the other hand, the recent gap area of 18248 – 18197 will provide cushion in the case of any minor degree dip," said Ratnaparkhi.

Where is Nifty50 headed?

Rohit Singre, Senior Technical Analyst at LKP Securities:

The immediate support for Nifty are coming near 18,250 followed by 18,170 zone any dip near mentioned support zone will be again fresh buying opportunity for the overall targets of 18500 zone, immediate hurdle is coming near 18,400-18,500 zone around mentioned resistance one can lock their long gains.

Mohit Nigam, Head - PMS, Hem Securities:

On the technical front, Nifty witnessed continuous positive trend after sustaining well above 18,200 levels. According to our technical analysis this positive momentum might continue till 18,500 levels in coming sessions. Immediate support for Nifty 50 is 18,200.

Ashis Biswas, Head of Technical Research at CapitalVia Global Research

If Nifty sustains above the level of 18,200-18,250, the positive momentum continues, leading to an upside projection till 18,550-18,600 level. The momentum indicators like RSI and MACD to stay positive and market breadth to improve, further strengthening a short-term bullish outlook.

Vinod Nair, Head of Research at Geojit Financial Services:

In the coming week, the domestic market awaits the release of quarterly earnings to determine the market trend. Banking will be the key sector under focus in the coming days as the sector is set to kickstart its earnings season. With the expectation of a strong recovery in corporate earnings, the Indian market is positioned to continue its bull run. However, any deviation from market expectation may lead to short-term correction in the respective segments"

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: Oct 16, 2021 10:03 am

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