Bounce expected in Nifty

The market rebounded after three-day losing spree with the Sensex rising 373.06 points or 1.07 per cent to settle at 35,354.08. The Nifty 50 index rose 101.85 points or 0.97 per cent to settle at 10,628.60. The BSE’s Mid-Cap index rose 0.06 per cent, while Small-Cap index fell 0.15 per cent.

Among the sectoral indices on BSE, the FMCG index (up 2.2 per cent), Bankex (up 1.27 per cent), Auto (up 1.1 per cent) outperformed the Sensex. However, the Metal index was down 1.33 per cent.

Among the gainers, Hero MotoCorp up 5.02 per cent, Asian Paints up 2.72 per cent, Axis Bank up 2.69 per cent, IndusInd Bank up 2.3 per cent, Bajaj Auto up 2.23 per cent and ITC rose 1.85 per cent.

While Yes Bank (down 3.89 per cent), ONGC (down 3.58 per cent), Sun Pharmaceutical Industries (down 2.88 per cent), Coal India (down 1.85 per cent) and Tata Steel (down 1.64 per cent) were the major losers.

Technical outlook

Jay Thakkar, head technical and derivatives research - AVP Equity Research at Anand Rathi Shares and Stock Brokers said, “The Nifty closed in the positive territory in the last trading session after candlestick pattern formation on the daily chart. The Index has achieved 50 per cent retracement target on the upside which is 10,610 levels now on the upside it can stretch up to 10,713 levels which is 78.6 per cent retracement level. The support on the lower side is pegged at 10,565 levels.”

“Sensex too closed in the positive territory in the last trading session which is a positive sign in the short term. The Index has taken support at 34,900 levels on a closing basis and it has again closed above 35,000 levels. The Index is likely to inch towards 35,650 levels which is 78.6 per cent retracement level. The support on the lower side is pegged at 35,100 levels,” he further said.

Market outlook

Mustafa Nadeem, CEO at Epic Research, said that the Nifty rebounded on the daily chart erasing almost previous two days of losses as Bulls utilised the correction to lower levels as buying opportunity. A negative sentiment was seen in early session due to previous week’s selling pressure but rebound was quicker in later hours of the session that led to a positive day. Technically, We are seeing the Nifty ranged between 20 Days SMA and 50 Days SMA.

Columnist: 
Ashwin J Punnen