Closing Bell: Nifty above 19,700, Sensex up 385 points; capital goods, realty, banks gain

Taking Stock: Market extends gains; Sensex up 385 pts, Nifty above 19,700

Among sectors, except FMCG and pharma, all indices traded in the green. Bank, capital goods, PSU Bank, power and realty were up 1-2 percent... Read More

Nifty closed higher for the fifth straight day with gains of 116 points (+0.6%) at 19727 levels. Despite weak global cues, market recovered in the second half on account of short covering on the weekly expiry day. Broader market too ended in green with Midcap100/Smallcap100 up 0.8%/0.5%.

Banking and Realty were the major drivers with gains of more than 1%. Niche sectors like Shipping and defence stocks continue to see buying interest on the back of large order wins and strong order book. Rally continued in paper and sugar stocks.

Nifty has shown good momentum in September so far and is inching closer towards its life highs where it could face some resistance. However, we expect outperformance in broader market to continue with interest in niche sectors.

The Nifty opened on a flat note and consolidated during the first half of the session. It was during the last couple of hours of the trading session that the Nifty witnessed a sharp surge which resulted in a positive close for the fifth consecutive trading session. The daily and the hourly Bollinger bands have begun to expand and prices are trading along the upper band indicating that the momentum is likely to continue. Daily and hourly momentum indicators have a positive crossover which is a buy signal. Thus, both price and momentum indicators suggest that there is further upside over the next few trading sessions. On the upside, we expect 19900 which is around the recent swing high. In terms of levels, 19600 – 19630 shall act as a crucial support zone while 19820 – 19850 shall act as an immediate hurdle zone.

Bank Nifty has broken out of a three-day consolidation on the upside which indicates that it has started the next leg of up-move. Daily and hourly momentum indicators are in sync with the price action which should provide speed to the present up-move. On the upside 45000 is the psychological hurdle and above that 45200 shall be the next possible hurdle. Overall, the trend is positive, and any intraday dips should be bought into.

The bulls were able to push Nifty higher following a range-bound trading period in the preceding few days. The sentiment remains positive as long as the index sustains above 19,550. On the higher end, gains may extend to the range of 19,900 to 20,000 in the near term, provided that bullishness in the market continues to increase.

Markets extended recovery on the weekly expiry day and gained over half a percent. The tone was range bound in the first half however a sharp surge in the select heavyweights turned the bias in favor of bulls as the day progressed. Eventually, it settled around the day’s high at 19727.05 levels; up by 0.59%.
Among the key sectoral indices, realty, banking and energy were on the forefront while defensive viz. FMCG and pharma ended dull. The broader indices also contributed to the move and gained over half a percent each.

Nifty has finally crossed the hurdle at 19,650 and the alignment of the banking pack has further strengthened the tone. We expect the index to inch towards the new milestone of “20,000” now. Traders should align their positions accordingly and maintain a balanced approach as broader indices look stretched.

After a volatile start, markets rebounded sharply to maintain its upward bias for the fifth consecutive session, even as foreign inflows continued to be patchy amid falling rupee and global economic uncertainty. Today's rally came despite weakness across the Asian and US markets, as investors remain upbeat about India's long-term growth prospects.

Technically, the Nifty successfully cleared the short term resistance of 19650 and post breakout it intensified the positive momentum. Higher bottom formation on intraday charts and bullish candle on daily charts supports further uptrend from the current levels. We are of the view that, 19650 would be the key level to watch out for, and above the same the index could move up till 19800-19825. On the flip side, below 19650, the uptrend would be vulnerable.

The weaker neighbour currencies and crude oil prices weighed on the rupee. On a closing basis, the local rupee settled at its lowest level. The probable central bank’s intervention limited the fall in the rupee in today’s trade. However, the trend remains bearish for the rupee amid broad-based strength in the greenback against all major trading partners.

Spot USDINR is expected to break the life of 83.29 and head towards 83.50 and 83.70 while may protect level of 82.90, in the coming days.

The domestic market initially opened with a lackluster performance, influenced by weak global cues. However, as the day progressed, a decline in U.S. bond yields and crude oil prices injected some positivity into the market. This optimism was most prominent in banking stocks. Interestingly, mid- and small-cap stocks managed to retain investor interest even though their valuations are relatively high. Nonetheless, the persistently weak trade data from China continues to cast a shadow over the global market's outlook.

Indian equities commenced the weekly expiry day on an extremely flat note but soon picked up momentum. In the second half of the trading session, a sharp uptick was seen across the board, especially in the banking counters which pushed the Index further higher to settle the day at 19,727.05 with gains of 116 points.

Apart from the Banking; Realty and Media sectors also participated in the rally while profit booking was seen in the FMCG and Pharma space.

By forming a strong bullish candle on the daily chart, the Index has breached its stiff resistance of 19,640 and extending the current up-move, the next resistance comes at 19,870 while support stands at 19,640.

Indian rupee ended marginally lower at 83.21 per dollar versus previous close of 83.13.

Benchmark indices ended higher for the fifth straight session on September 7 with Nifty above 19,700.

At close, the Sensex was up 385.04 points or 0.58 percent at 66,265.56, and the Nifty was up 116.00 points or 0.59 percent at 19,727. About 2140 shares advanced, 1420 shares declined, and 124 shares unchanged.

Top gainers included Coal India, L&T, IndusInd Bank, SBI Life Insurance and Tech Mahindra, while losers were Tata Consumer Products, M&M, Britannia Industries, Sun Pharma and Infosys.

Among sectors, except FMCG and pharma, all other indices are trading in the green with bank, capital goods, PSU Bank, power and realty up 1-2 percent.

The BSE midcap index gained 0.8 percent and smallcap index rose 0.4 percent.

-Overweight rating, target at Rs 1,350 per share
-Loan growth remains strong, competitive intensity is high
-Management reiterated guidance of maintaining FY24 margin at levels similar to FY23
-Over medium-term, bank expects operating leverage to play out

Benchmark Indices staged a smart afternoon rally today with the help of PSU & Infrastructure stocks. With a 13.5% share of the market capitalisation, PSU companies have seen a robust jump from just over 9% in 2021 even as several Midcap State Owned Entities have seen a multi-fold rise in their stock values during this period. ETF Flows during the late afternoon also helped Large-Caps recover lost ground.