The market ended the first week of the financial year 2023-24 with gains of more than a percent. FII buying, a surprise rate pause by the Reserve Bank of India (RBI) and higher GST collection and manufacturing data, helped the indices close higher.
In the week ended April 6, the 30-pack Sensex rose 841.45 points, or 1.42 percent, to close at 59,832.97, while the broad-based Nifty gained 239.4 points, or 1.37 percent, to end at 17,599.15.
For the week, the BSE smallcap index added 3 percent, midcap a percent and the largecap index was up 1.3 percent.
"Both Nifty and Sensex jumped aided by improved overseas fund inflows and positive global cues. Indian equity markets remained concerned about growth prospects, even as inflation continued its downward trajectory, both globally and domestically," Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities, said.
In a role reversal of sorts, foreign institutional investors (FIIs) were net buyers, while domestic institutional investors (DIIS) were net sellers for the week. FIIs bought shares worth Rs 1,604.56 crore, extending buying for the second week. DIIs, which typically cushion the market against foreign investors' selling, booked profits and sold shares worth Rs 2,272.53 crore.
“Going forward, D-street will focus on the macro trends. Markets going will be dictated by global news flows and steps taken by different governments to tackle their economy,” Chouhan said.
On the sectoral front, the BSE realty index added over 4 percent, capital goods 3 percent and the telecom index was up 2.6 percent.
The BSE smallcap index gained nearly 3 percent, with Dhani Services, Nandan Denim, Black Rose Industries, Rama Phosphates, Atul Auto, Ruby Mills, Andhra Petro, 3i Infotech, Brightcom Group, TARC, Fermenta Biotech, TTK Healthcare and Gulshan Polyols adding between 25 and 53 percent.
The losers included KPIT Technologies, Orient Electric, MPS, Capri Global Capital, Global Health, Kriti Industries (India), Ahluwalia Contracts India, MAS Financial Services and Route Mobile.
Where is Nifty headed?
Amol Athawale, Deputy Vice President-Technical Analyst, Kotak Securities
Technically, after a long time, the Nifty reclaimed the 200-day simple moving average (SMA) and formed a bullish candle on daily and weekly charts. We are of the view that 17,500 and 17,375 can act as key support areas for the index, while 17,700 -17,800 will be the resistance zone.
The Bank Nifty also formed a bullish candle on weekly charts and successfully traded above the 50-day SMA. For the index, 40,700 or the 50-day SMA can be the sacrosanct support, above which the index can move to 41,500-41,700.
Ajit Mishra, VP-Technical Research, Religare Broking
The stability on the global front has eased some pressure and now the focus will be on earnings. We expect some consolidation in the Nifty in view of the multiple hurdles around the 17,600-17,700 zone. Rotational buying across index majors, however, will help in maintaining a positive tone.
Participants should continue with a stock-specific approach and focus on overnight risk management.
Rupak De, Senior Technical Analyst, LKP Securities
A positive crossover in the momentum indicator Relative Strength Index (RSI) will boost sentiment.
The market will remain buy-on-dips as long as it stays above 17,500. On the higher end, immediate resistance is at 17,700, above which the index can move higher levels.
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