Today’s Action:
Major indices recover early losses; end near day’s highs.
Daily Market Review:
The Indian stock market remained resilient in the face of rising crude prices, delivering its fifth straight session of gains.
After slipping into the negative territory early on in today’s session, the frontline indices did well to recoup losses and pocket small gains. Nifty and Sensex logged gains of 0.1% and 0.2%, respectively.
Oil marketing companies (OMCs) had a forgettable session as Hindustan Petroleum, Bharat Petroleum and Indian Oil tumbled 6-8%. Amid rising crude oil prices, the Indian government might ask the OMCs to absorb price hikes, resulting in lower margins.
Broader indices did not have much to cheer about, as investor interest in smaller stocks remained subdued. Nifty Midcap closed flat while Nifty Smallcap ended 0.1% lower.
On the sectoral front, the Nifty Metal (+1.6%) and IT (+1.5%) indices accumulated solid gains. On the downside, the Nifty Bank index lost 0.5% due to weakness in public sector bank stocks.
Contrary to the gains in key indices, market breadth favoured losers once again. Of the 1,634 stocks traded on the NSE, 935 declined, 636 advanced, and 63 remained unchanged.
Our proprietary list of leading stocks, the MarketSmith India {IND 47 index} outperformed the overall market with a gain of 0.7%.
Talking about market direction, the Indian market remains in a Confirmed Uptrend. The green light is on for investors to look out for growth stocks that are breaking out of sound chart patterns. We continue to see stocks breaking out of valid base patterns along with some of them making new highs.
Going ahead, the resistance at 50-day line should be watched closely. While the index managed to reclaim its 50-day line on intraday basis, it failed to close above it in today’s session. A retake of the 50-day line would certainly be a sign of good things to come.
Current Outlook:
– Market environment conducive for purchases, but remain selective.
– Focus on fundamentally strong stocks breaking out of strong technical patterns.
– Stay disciplined and exercise sound buy and sell rules.
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