Below is the Views On Indian equity markets opened positive but remained consolidative by Mr. Siddhartha Khemka, Head - Retail Research, Motilal Oswal Financial Services Ltd.
“Indian equity markets opened in green, and continued to gain strength, finally ending near day’s high. Nifty50 closed 82 points higher (+0.7%) at 11522, while Sensex ended 288 points higher (+0.7%) to 39,044. The broader market continued with its outperformance with Nifty Midcap 100/ Nifty Small Cap 100 up 1.1%/1.5%. India VIX dropped by 3.8% to 20.4. Pharma and Private Banks led to the rally, both up 1.9% each, followed by IT, Infra and Energy. Realty, Media and FMCG witnessed some profit booking.
The global cues were positive on the back of upbeat Chinese data and optimism about coronavirus vaccines. China’s industrial output accelerated the most in eight months in August, while retail sales grew for the first time this year. On the domestic front, Indian market followed global cues and small-cap and mid-cap stocks extended gains from the previous session. India’s annual retail inflation also eased to 6.69% in August, though it remained above the RBI’s medium-term target for a fifth straight month, which is unlikely to give the RBI room to cut rates at its October meeting.
Going ahead, the market is likely to consolidate in near term with positive bias. All eyes would be on Central Banks globally as US Fed’s 2-day policy meet begins today while its peers European Central Bank, Bank of England and Japan would meet later this week. Investors would also be looking at the developments around the Covid vaccine and UK Vote on Brexit. Mid-cap/Small-cap companies have been relative outperformers in CY20 and the momentum may continue in the near term. Thus any weakness in the market should be looked as a buying opportunity to add quality stocks in the portfolio as the overall long term market trend remains positive.
Technically, Nifty has to hold above 11450 zones, to witness an up move towards 11800 zones while support exists at 11350 zones. “
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