Dalal Street Corner: Markets close at 3 months high; what should investors do on Tuesday?

The Indian markets closed on a higher note on Monday, with the Sensex gained almost 100 points, while the Nifty50 settled above the 18300-mark for the first time since last 3 months. The broader markets too closed positive with Nifty mid-cap up almost 0.2 per cent and small cap up over half a per cent. 

At least 34 stocks closed in the green on Nifty50 with Hero MotoCorp leading the surge over 5 per cent, as the company announces investment in EV company Ather Energy, followed by Grasim and ONGC shares each surged over 3 per cent. On the contrary, 16 stock closed in the red with HCL Tech dipped most by 5 per cent amid mute Q3 results. 

See Zee Business Live TV Streaming Below:

During Monday’s session, insurance companies rise with SBI Life hitting 52-week high, while index heavyweight Bajaj Finance and mid-cap IT firm L&T Tech close with minor gains ahead of earnings on Tuesday. Similarly, Granules, Dr Lal Path Labs, Vedanta, Nalco, Laurus Labs are top midcap losers. 

Sectorally, banking and financial indices tried to drag the market in the red, with former slipped by 0.4 per cent and latter by 0.24 per cent. Similarly, Nifty Pharma declined almost 1 per cent at close. On the contrary, Nifty Auto aided the market most by gaining over 2 per cent at the close. 

Vinod Nair, Head of Research at Geojit Financial Services, “In a week guided by the release of various corporate earnings, domestic indices edged higher on a flat note led by consumer durables, energy and auto stocks.”  

“Asian markets were largely mixed post the release of China’s 4th quarter GDP data reporting an expansion of 4 per cent year-on-year as covid restrictions and property woes hit demand. Rising covid cases globally continue to colour investor sentiments,” he added 

Vijay Dhanotiya, Senior Research Analyst at CapitalVia Global Research Limited, said “Market research suggests that 18200-18250 will be an important support zone and if it sustain this level, we can expect the volatility to expand, that could lead to an upside projection till 18550-18600.” 

“During the afternoon session, markets showed some strength and traded in positive territory as traders were getting relief, as foreign portfolio investors (FPIs) reversed the three-month selling streak in January by investing net Rs 3,117 crore in Indian markets,” Narendra Solanki, Head- Equity Research (Fundamental), Anand Rathi Shares & Stock Brokers on market performance. 

According to S Ranganathan, Head of Research at LKP securities, “Auto stocks shined in a flat trading session on the back of price hikes, thrust on electric vehicles and ETF launches in the sector as the basket of stocks posted smart gains.” 

Technically, the index has given breakout above the prior swing high and and formed a bullish candle on a daily time frame which suggests an upside rally in the counter. Furthermore, the index has been trading above Ichimoku cloud which adds strength for upside, Palak Kothari Research Associate Choice Broking said in post market comment. 

The index has been trading above 21&50-DMA with a positive crossover as well as a momentum indicator MACD & STOCHASTIC are trading with a positive crossover on the daily time-frame which suggests strength in the counter, Kothari added. 

“At present, the Index has support at 18200 levels while resistance comes at 18380 levels, crossing above the same can show 18500-18600 levels. On the other hand, Bank nifty has support at 37800 levels while resistance at 39000 levels, the analyst also pointed out.