Dalal Street Corner: Sensex, Nifty end 6-day losing streak; what should investors do on Tuesday?

The domestic markets managed to end the six-day falling streak on Monday, helped by a last-hour recovery. The benchmark indices BSE Sensex and Nifty closed near day’s high at around 0.5 per cent higher from the previous closing. Meanwhile, midcap and small cap underperformed the benchmarks, down over 2 and 3 per cent respectively. 

As many as 27 stocks on Nifty50 advanced, while 23 declined at the close. HDFC Bank become a top gainer, up nearly 4 per cent, followed by Hindustan Unilever, which also gained nearly 4 per cent. While Britannia, Wipro Asian Paints, Apollo Hospitals, each gained around 3 per cent at the close. 

On the other hand, ONGC became top Nifty loser dragged by lower crude oil prices. The shares were down almost 5 per cent, followed by Tata Steel which was down by over 4.5 per cent. Meanwhile, UPL and Hindalco slipped over 3 per cent and IndusInd Bank dipped over 2.5 per cent at the market close. 

Sectorally, FMCGs move higher on positive cues, as HUL, Pidilite, Godrej Consumer gained most, conversely, Metal basket slides, tracking a sharp fall in prices, stocks down 2-15 per cent.  

We have collated views from different experts as to what investors should do when trading resumes:

Expert: Vinod Nair, Head of Research at Geojit Financial Services. 

Positive trends in the global markets inspired domestic market to trade positively with large caps gaining the most while mid & small caps continued to trade with cuts. Prevailing inflationary pressure and concerns over policy tightening limited the upside. Among the sectors, metals were the top laggard due to a sharp fall in commodity prices along with a fall in global & domestic demand. 

Expert: Kunal Shah, Senior Technical & Derivative Analyst at LKP Securities. 

The Nifty index witnessed consolidation with the heavyweights supporting the index while the broader market continued to witness deep pain. The index lower end support stands at 15200 and immediate resistance is placed at 15450 a break on either side will lead to trending moves. The resistance if taken out can witness a rally towards 15800 levels. 

On the daily chart. The immediate resistance on the upside is placed at 33,100 level and a break above this can witness some short covering. The downside support stands at 32,400 and a breach below this will lead to fresh round of selling pressure. 

Expert: Ajit Mishra, VP - Research, Religare Broking Ltd 

Markets ended higher in a volatile trading session, taking a breather after the recent decline. After the flat start, the benchmark oscillated in a narrow range and finally ended closer to the day’s high.  

We feel it’s just a pause after the sharp decline and participants should look for shorting opportunities in case Nifty witnesses any rebound towards the 15,550-15,700 zone. For cues, the performance of the global indices and crude movement will remain in focus. 

Expert: Sandeep Jain, Director at TradeSwift 

Broader markets have witnessed a biggest fall and believe a short bounce in the market likely, which traders should see this is an opportunity and sell with strict stoploss. While long-term investors should Buy value stocks with a time horizon of 2-2.5 years.  

The Nifty Index has taken a support at 15350-level, supported by heavyweights such as HDFC and HDFC Bank and got a strength from FMCG stocks such as HUL and Britannia.