The Sensex was down around 10 points at 73,023, while the Nifty 50 fell 20 points to trade near 22,700, as seen at around 10:10 am on Wednesday. Broader markets remained mixed, with the Nifty Midcap 100 in the red and the Nifty Smallcap 100 in the green.
IT stocks extended sharp gains as the global AI-driven selloff continued to ease, with TCS, Infosys and HCL Tech shares jumping around 2% each to lead gains on the Sensex. Meanwhile, shares of Kotak Mahindra Bank, UltraTech Cement, HUL and BEL gained around 1% each. Shares of Bajaj Finance, Sun Pharma, Bajaj Finserv, L&T, Adani Ports, Eternal, M&M, Power Grid, ICICI Bank, Titan and SBI fell around 1% each.
The Nifty IT continued to lead market gains, jumping more than 1% despite the muted sentiment. The Nifty Pharma, meanwhile, dropped over 1% to lead losses. Overall market breadth remained positive, with 2,041 stocks advancing, 1,089 declining and 85 remaining unchanged on the NSE.
What lies ahead for Dalal Street?
Nifty’s sharp 358-point rally yesterday, in an otherwise weak downtrending market, came as a bit of a surprise, said V K Vijayakumar, Chief Investment Strategist, Geojit Investments. Bears holding short positions must have rushed to cover them as the market suddenly turned, he noted.Also read | Why did market rally on Tuesday?
The rally was triggered by Finance Minister Nirmala Sitharaman’s comment at the Bloomberg New Economy Forum that “the government would carefully review and discuss stakeholder feedback regarding the LTCGs tax and STT.” The market’s response indicated that investors were hopeful of potential changes to LTCG tax, the analyst noted.
RBI measures to restrict speculation in the currency market led to a 1.5% appreciation in the rupee over the last two trading days. This has helped reduce FII selling in the market significantly, Vijayakumar said. He, however, highlighted that the US 10-year Treasury yield hovering around 5.2% and Brent crude trading around $106 continue to be strong headwinds for the market.
“It would be difficult for the rally to sustain given these negatives. But segments like financials, telecom, metals and automobiles which are likely to report good Q2 numbers will remain resilient,” he added.
Technical view for Nifty
Yesterday’s sharp gains have renewed hopes of the Nifty moving towards 23,200, said Anand James, Chief Market Strategist, Geojit Investments. “That said, we are about to enter a congestion region that may challenge the upside momentum,” he noted.“But, we see 22,550 as a downside marker and expect the index to test the 22,787-22,880 resistance zone,” he added.
Also read |Which bank stock should you buy ahead of Q2 results - HDFC Bank, ICICI Bank, Yes Bank or Axis Bank?
Disclaimer: This article has been written by Debaroti Adhikary, who is not a SEBI-registered Research Analyst or an Investment Adviser. Debaroti Adhikary and his/her ‘relative(s)’ (as defined under Section 2(77) of the Companies Act, 2013) do not hold any financial interest in the companies mentioned in this article as of the date of publication. The views/recommendations mentioned in this article, wherever applicable, are those of the respective SEBI-registered Research Analyst/brokerage and have been reproduced/reported with due attribution. They should not be construed as the views or recommendations of The Economic Times Digital or the journalist. Readers are advised to consider the original research report and make their investment decisions based on their own assessment. Brokerage disclaimers here.
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