Published on 5/06/2020 7:37:19 PM | Source: Motilal Oswal Financial Services Ltd

Daily Market Commentary 5 June 2020 by Mr. Siddhartha Khemka, Motilal Oswal

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Below is the View On Daily Market Commentary by Mr. Siddhartha Khemka, Head - Retail Research, Motilal Oswal Financial Services Ltd

“Indian equity markets ended the volatile session in green led by Banks and Metals. Nifty50 rose 113 points (+1.1%) to close at 10,142 level, while Sensex was up 307 points (+0.9%) to close at 34,287 level. Lot of action was seen in the broader market with Nifty Midcap 100/Nifty Smallcap 100 outperforming with gains of 1.8%/3.4% respectively. All the sectors ended in green except FMCG which ended in marginal red. PSU banks was the biggest gainer, up 6.9% followed by Media (+5.3%), Metals (+3.9%) and Private Banks (2.4%). India VIX cooled down 4% to 29 levels.

Indian equities followed positive global cues, which was driven by ECB’s additional stimulus boost. Investors are pricing in a global economic recovery, supported by Central Banks’ policy measures across geographies. Strong FII inflows over past few days have also provided support to the market.

Given the sharp rally witnessed over last few days, we may see the Indian markets consolidating or taking a breather, before starting the next leg of rally. Even valuations have turned expensive at 21xFY21E earnings and any negative development on the global front might derail the momentum. Hence, 'Buying on Decline’ would be a better strategy over the next few weeks.

Technically, immediate hurdle for index is placed at 10300 and then 10500 zone while support exists 10000 then 9950-9890 zones.”


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