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

Equity markets started the week on a positive note with Nifty/Sensex surging 144/508 points higher (+1.0%/+1.1%) to close at 14,485/ 48,387 respectively. Broader markets too gained with Nifty MidCap 100/Nifty Smallcap 100 up +0.8%/+1.1%. Except Pharma (-0.9%), all the other sectors ended in green. Realty was the biggest gainer – up +3.4%, followed by Banks, Financials, and Metals which gained 1-2%. However, India VIX moved up by 3.55% from 22.69 to 23.49 levels.

Global cues were positive as strong US PMI data last week boosted confidence on economic recovery front. On the other hand, Copper prices hit 10 year high while various agricultural commodity prices hit 8 year high which cheered the market. Further, the EU is getting ready to let U.S. tourists back in while Singapore and Hong Kong look to start travel corridor in May which shows confidence boost. On the domestic side, Nifty opened gap up and sustained its momentum throughout the session. Positive global cues along with medical support from across the globe, to help India fight the pandemic, boosted market sentiments. In addition, good results from ICICI Bank and strong management commentary led to rally across the Banking and Financial stocks. HCL Tech on the other hand shredded ~3% post a miss on Q4 results. Axis Bank, UltraTech Cement, ICICI Bank, JSW Steel and Grasim Industries were among top gainers on the Nifty, while losers included Cipla, Britannia Industries, HCL Technologies, BPCL and HDFC Bank.

Technically, Nifty formed a Bullish candle on daily scale and has been forming higher highs - higher lows from the last two sessions. Now, it has to continue to hold above 14400 zones to witness an up move towards14600 and 14700 zones while on the downside, support exists at 14300 and 14150 zones.

Going ahead, Indian markets are likely to continue with its volatility as the earnings season gains momentum while COVID-19 cases continue its upward trajectory. Market would continuously watch out for government’s course of action along with progress on vaccination drive in order to curb pandemic. Investors would also keep an eye on management commentaries in the their post result concalls, given the current situation. This week investors would await US GDP data along with US Fed’s monetary policy. Even President Joe Biden is expected to spell out his infrastructure spending plan, and the tax hikes to pay for it which could set the market tone for near term.

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