Below is the Daily Market Commentary By Mr. Siddhartha Khemka, Head - Retail Research, Motilal Oswal Financial Services Ltd
Equity markets had one of the best days in over 2 months on the back of all round buying, Index rebalancing related flows and buying before the financial year end. Nifty made gains for second day in a row closing at 14,825 with gains of 2.3% (338 points) recovering the entire decline of the last week. Sensex too gained 2.3% (+1128 568 points) to close above 50k mark at 50,137. The broader markets too remained positive with Nifty MidCap 100/Nifty SmallCap 100 up +1.7%/+1.3% marginally underperforming the Nifty. Baring Realty which closed in marginal red (-0.03%) all other sectors closed in green. IT Index was the lead gainer up 2.9%. The index has gained almost 7.5% in the last one month. Metals too continued from where they had left on Friday with gains of 2.8%, followed by Pharma (+2.7%), FMCG (+2.3%).
Global cues were positive despite concerns about a hedge fund default that shook global banking stocks. European markets rose near record highs, as investors focused on prospects of faster vaccine progress in the U.S. and investors weighed the outlook for economic growth and inflation. US President Joe Biden's announcement that 90% of adults will be eligible for the COVID-19 vaccine next month helped U.S. stocks recover from their lows. Also the US President
Domestically, markets opened positive and gained over 2% led by Technology and Metal stocks. Some of the Stocks that were is strong momentum were Infosys, TCS, HCL Tech, Tata Steel and SAIL. Metal stocks continued to witness buying for 2nd consecutive day. Increased domestic demand and hope of improving global steel consumption boosted steel stocks. Driven by higher metal prices, the past 12 months have been one of the best for metals & mining stocks. Technically, Nifty formed a healthy Bullish candle and is holding above its 50 DEMA. Now, it has to continue to hold above 14,750 zones to witness an up move towards 15000- 15100 levels while on the downside support exists at 14,600-14500 levels.
Indian markets are likely to track global cues in this truncated week of trade. All eyes will be on US President who is due to deliver a speech on Wednesday unveiling his new $3 trillion infrastructure plan as part of his "Build Back Better" agenda. Also with the financial year ending, investors would now focus on upcoming quarterly results which would begin in next 10-15 days. On the other hand, concerns over the fast spreading 2nd wave of covid in India continues to remain. Overall markets are likely to remain in a consolidative mode for some time awaiting for fresh positive triggers. Hence investors would do well by gradually accumulating good quality companies on any declines in the market.
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