Dalal Street Corner: Markets end over two-and-half months high; what should investors do on Thursday?

The Indian markets closed higher for the fourth straight session with over two-and-half months high on Wednesday.

The BSE Sensex closed over 500 points and the Nifty50 above the 18200-mark for the first since October 27, 2021, led by the auto and metal stocks. 

In the broader markets, Nifty Mid-cap jumped over 1 per cent, while small-cap closed around 1 per cent higher. Similarly, Nifty Bank, a key contributor to the Nifty index, closed almost 300 points higher, above the 38,700-mark at the market close. 

Top gainers in Nifty50 were M&M up 4.65 per cent, followed by Bharti Airtel, which jumped almost 4 per cent, while top losers were Titan, which fell by 1.52 per cent, followed by TCS with nearly 1.5 per cent. 

Global markets showed strength as markets reacted positively to US Federal Reserve chairman Jerome Powell’s testimony, taking cue the Asian markets were trading in the green today.  

The majority of the sectoral indices ended in the green with Nifty Realty gained the most by 1.72 per cent being the top gainer, followed by Nifty Oil and Gas.  

The investor sentiments magnified as the World Bank raised the growth forecast for India to 8.7 per cent for FY23 from its earlier prediction of 7.5 per cent, this can be attributed to the resurgence in the private capex cycle, Mohit Nigam Head PMS, Hem securities said in a post-market comment. 

“On the technical front, the key resistance levels for Nifty50 are 18400 and on the downside 18000 can act as strong support. Key resistance and support levels for Bank Nifty are 39000 and 38400 respectively, the market analyst further said. 

Vinod Nair, Head of Research at Geojit Financial Services in his post-market comment said, “Led by realty, auto, energy and banking stocks, benchmark indices continued its winning streak for the 4th consecutive day despite the fast spread of covid cases.” 

Realty stocks continued their upward rally on healthy business updates resulting in improved outlook, Nair said, further stating that the initial results of major IT firms will determine the momentum of the week ahead. 

According to Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities Ltd, “The Nifty has maintained a breakout continuation formation but profit booking at higher levels is not ruled out due to the extended rally in recent sessions.” 

“The 18100 level would be the key to watch out for and above the same the uptrend texture will continue up to 18275-18350. On the other hand, below 18100, the market may trigger short-term correction up to 18050-18000 levels,” he added in his post-market comment. 

Gaurav Ratnaparkhi, Head of Technical Research, Sharekhan by BNP Paribas said, “The Nifty has achieved its short-term target of 18140, which is 78.6 per cent retracement of the October – December decline.” 

He added, “It got extended beyond that level however halted near the crucial November swing high, which is 18210. On January 12, the index has created a gap are of 18081 – 18128 on the daily chart. The bulls need to hold on to this gap area to keep the upward trajectory intact. In that case, the index can test its weekly upper Bollinger Band near 18400.”