Dalal Street Corner: Benchmarks pull off smart recovery on strong buying interest from domestic investors; what should investors do on Wednesday?

The Indian markets ended around one and half a per cent higher amid multiple factors, including strong buying interest from domestic investors, anticipating record GST collection in April and support from realty and auto stocks. The market capitalisation of BSE listed companies rose by more than 4 lakh crore in a single day as m-cap of these companies jumped from Rs 2,65,29,671.65 crore on April 25 to Rs 2,69,41,299.15 on April 26 amid buying from all corners. Besides, Nifty realty and auto stocks 3.5 and 2.8% gains led the market recovery on Monday as benchmarks Nifty settled aroudn 17,200 and the Sensex around 57, 350.  

Amid improved global cues, headline indices Nifty50 and Sensex zoomed 1.46% and 1.37% respectively to settle at 17, 200 and 57, 356 on Tuesday.   

Though buying was seen in all sectors, it is realty, auto, FMCG, Consumer Durables and Oil & Gas that attracted the investors most on Tuesday.  

Following benchmark indices, Nifty mid cap and small cap too rose 1.6 and 1.1% respectively as India VIX settled near 19-mark.  

As markets continue to trade with volatility and have been swinging wildly on both sides, here is what experts have to say about today's market behaviour and how it is likley to react going forward. They also advise investors what should they do in current market scenario.  

Vinod Nair, Head of Research at Geojit Financial Services

Strong buying interest from domestic investors and positive global trend resulted in a rebound. But volatility persists due to lockdown in China, Russia – Ukraine war and rate hikes. However, dips are encouraging investors to accumulate quality stocks. In a range bound market, it is advised to stick with sectors which are expected to be least impacted by inflation and rising bond yield, banking, IT, Pharma and themes like green energy. 

S Ranganathan, Head of Research at LKP securities.  

Benchmark Indices gained one and a half percentage today on expectations of record GST collections for April even as FII ownership dropped to multi-year lows at 20%. Bajaj Group stocks, Autos & Real Estate stocks staged a smart recovery today with almost all sectoral indices ending in the Green.  

FII's continue to be the second highest owners of Financials in India after the GOI despite the sector seeing the highest FII selling during the last one year. The broader markets witnessed buying interest in Footwear stocks with half a dozen listed entities gaining share in both value for money as well as aspirational brands. Earnings expectations also buoyed stocks of state-run enterprises of Gujarat in today's trade. 

Gaurav Ratnaparkhi, Head of Technical Research, Sharekhan by BNP Paribas  

The Nifty provided some breathing space to the bulls on April 26, who were beaten down in the last couple of sessions. With the bounce today, the index has filled up the recent gap area of 17054 – 17149. It halted near a falling trendline on the hourly chart, which is around 17200. Additionally, the key daily moving averages are standing as barriers near 17200-17400 zone.

The overall structure suggests that the index is trading near its short-term hurdles & can slip down again in the coming sessions. On the downside, the Nifty can test the swing low of 16824. This bearish stance holds true as long as the index trades below the swing high of 17415. 

Disclaimer: The views/suggestions/advice expressed here in this article are solely by investment experts. Zee Business suggests its readers to consult with their investment advisers before making any financial decision.