Mid-day Mood | Nifty reclaims 21,600 as investors resume buying, Sensex rises 450 points

Sensex, Nifty resume uptrend after 2 days of profit-booking.

Benchmarks Nifty and Sensex resumed their uptrend on January 4 after selling in the past two sessions as investors bought the dip. The up-move was led by frontline banking stocks that inched higher on the back of their robust monthly updates.

Around noon,  the Sensex was up 456.71 points or 0.64 percent at 71,813.31, and the Nifty was up 125.10 points or 0.58 percent at 21,642.40. About 2,314 shares gained, 926 suffered losses, and 86 traded unchanged.

The market breadth also favoured gainers as more than two stocks gained for each one that lost.

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Sectoral trends

The information technology sector started the session with gains following JP Morgan's positive outlook, however, investors soon rushed to book profits pulling the Nifty IT index back into the red.

Banking names witnessed strong buying after the lenders released their robust monthly updates. Names like IndusInd Bank, HDFC Bank and Axis Bank gained which pulled the Bank Nifty index around 1 percent higher.

Other sectors like energy, metals, pharma, automobile, infra, FMCG and PSU banks also edged higher.

Fundamental view

"Markets have a tendency to overreact. Perhaps the sharp rise in the US market in response to the Fed pivot was a bit overdone. The marginal rise in the US bond yield is a reflection of the market concern regarding the timing of the expected Fed rate cut," said VK Vijayakumar, chief investment strategist at Geojit Financial Services.

"A good strategy now would be to move some money from the overpriced midcaps and smallcaps to the fairly priced high-quality largecaps like the leading banking names," he said.

Technical view

"The Nifty can find support at 21,475, followed by 21,450 and 21,400. On the higher side, 21,600 can be an immediate resistance, followed by 21,650 and 21,700," said Deven Mehata, derivative analyst at Choice Broking.

For Bank Nifty, Mehata sees support at 47,500, followed by 47,300 and 47,200. "If the index advances, 47,900 would be the initial key resistance, followed by 48,000 and 48,200," he said.

Key Nifty gainers
NTPC, Bajaj Finance, IndusInd Bank, Tata Consumer Products, ONGC

Key Nifty losers
BPCL, LTIMindtree, HCLTech, Dr Reddy's Labs, Ultratech Cement

Key Sensex gainers
NTPC, Bajaj Finance, IndusInd Bank

Key Sensex losersTCS, HCLTech, Maruti Suzuki

Stock moves

IndusInd Bank: Shares inched nearly 3 percent higher after the private sector lender reported a 20 percent growth in the third quarter advances and a 13 percent surge in deposits.

NTPC: Shares of gained nearly 4 percent after Axis Securities initiated coverage on the stock with a buy rating and a target price of Rs 345 per share. According to the Axis Securities report, NTPC's substantial portfolio in conventional power, with a firm cost-plus business model, positions it well in a growing peak power cycle. This, the analysts say, will help contribute to stable cash flows and facilitate growth led by renewable energy.

Bajaj Finance: Stock gained over 3 percent after the company's assets under management (AUM) grew 35 percent on-year to Rs 3.11 lakh crore in December, suggesting a strong festive period. This is the first time that the company's AUM has crossed the Rs 3-lakh-crore mark. Bajaj Finance's deposit book also grew by 35 percent to Rs 58,000 crore. During the quarter, it booked 98.6 lakh new loans, a YoY growth of 26 percent.

Also read | Sensex, Nifty rise after 2 days of profit-booking, largecap flavour plays out

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