Nifty, Sensex rise 1% to end higher for 2nd straight day; volatility to persist, stock specific action likely

Nifty, Sensex rise 1% to end higher for 2nd straight day; volatility to persist, stock specific action likely

Benchmark indices surged over 1 per cent higher on Monday, led by nearly broad-based buying. The S&P BSE Sensex jumped 760 points to end at 54,521 level while the Nifty closed at 16,279, up 229 points. The frontline indices jumped on the back of gains in blue chip stocks including Infosys, ICICI Bank, Kotak Bank, TCS, Axis Bank, L&T, SBI, and Reliance Industries. All these index heavyweights rallied between 0.85 per cent and 4.5 per cent. Sectorally, all the indices, except the Nifty Pharma index, settled in the positive territory. The Nifty IT index advanced over 3 per cent, followed by the Nifty PSB index (up 3 per cent), and the Nifty Metal index (2.5 per cent).

“Strong US retail sales data scaled down the worries of an aggressive rate hike higher than 75bps providing the much-needed optimism to global equities. The European Central Bank, in its meeting this week, is set to increase its interest rates for the 1st time to contain record high inflation. On the domestic front, while IT and banking stocks were lifted by bottom fishing, realty stocks accumulated gains on improving business prospects,” said Vinod Nair, Head of Research at Geojit Financial Services.

Ajit Mishra, VP – Research, Religare Broking

Markets started the week on a buoyant note and gained nearly one and a half percent, tracking firm global cues. After the gap- up start, the benchmark gradually inched higher as the day progressed and finally settled around the day’s high. Markets are largely mirroring their global counterparts, especially the US while domestic factors like macroeconomic data and earnings cause volatile swings in between. Amid all, we reiterate our positive yet cautious view as we’re eyeing the 16,300-16,500 zone in Nifty. Participants should focus more on stock selection and overnight risk management.

Deepak Jasani, Head of Retail Research, HDFC Securities

Nifty rose sharply on July 18 aided by supportive global sentiments. Nifty opened gap up and inched up through the day to close almost at the intra day highs. At close, Nifty was up 1.43% or 229.3 points at 16278.5. World stocks rose on Monday as scaled back bets on the latest Federal Reserve rate hike next week and support pledges for China’s economy lifted the mood. Investors are seen staying a bit cautious ahead of a European Central Bank policy meeting and a scheduled resumption of Russian gas flows via the Nord Stream 1 pipeline. Morgan Stanley has slashed its forecast for India’s economic growth by 40 basis points to 7.2 percent for this financial year and the next in view of a slowdown in global growth. Nifty has scaled a new high of the past 5 weeks. 16487-16514 band is the next resistance while the supports shift to 16070-16140. Positive global sentiments keeps buoying the Nifty and hence one will have to watch them closely.