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Home / Markets / Stock Markets /  Sensex retakes 44,000. Nifty ends Nov F&O series near 13K. What analysts say

Indian shares jumped today in a broad-based rally after a sharp fall in the previous session. On the expiry day of weekly and monthly derivatives contracts, the NSE Nifty 50 index ended 1% higher at 12,987.00, rebounding from losses earlier in the session while Sensex closed 431 points higher at 44,259.

Most sectors settled higher but metals and mining shares rose the most among 13 sectoral indexes, gaining 3.85% to clock their best day in three weeks, in line with a rise in metals prices globally.

Financial companies including HDFC Bank and Kotak Mahindra Bank were the top boosts to the Nifty 50, followed by JSW Steel and Tata Steel, which rose 6.1% and 5.0%, respectively.

"Today, the market regained its momentum during the second trading half, on the monthly derivative expiry day, led by bounce in the banking sector. Investors are awaiting the release of Q2 GDP data tomorrow, the market expects contraction on a YoY basis but improvement on a QoQ basis, reflecting recovery in economic activity. The recovery is expected to further rise in Q3, and the market optimism is also high with the news that vaccine will be available in early 2021," said Vinod Nair, Head of Research at Geojit Financial services.

Sectors, including metals and real estate, have gained sharply this month as investors continue to favour companies seen as likely to benefit from an economic recovery and as foreign money managers pump billions of dollars into Indian equities. Inflows from foreign institutional investors have reached a record of more than $7 billion this month.

Global markets were mostly higher today on optimism around vaccines and the incoming Biden administration in the United States.

Here is what analysts said on today's market performance:

S Hariharan, Head - Sales Trading, Emkay Global Financial Services

‘’A 50% month-on-month increase in net long positioning for FIIs in index futures has led to an expansion of rollover basis across the board this month. This has accompanied a 14% increase in market-wide open interest in single stock futures. Hence, sentiment going into December series is quite bullish. On the other hand, November has seen a record inflow of $7.5 billion from FPIs in equities and coincided with 11% return on Nifty and record selling from DIIs worth $5.5 bn. Favourable macro for EM equities driving flows are predicated on a weak dollar, which is among the highest consensus trades and vulnerable to a news-based squeeze as well. In aggregate, while the underlying trend remains strong, there is some risk of a pullback in aggregate, emanating from an ebbing of FPI flows.’’

Nagaraj Shetti, Technical Research Analyst, HDFC Securities

"The formation of reversal pattern of Wednesday (bearish engulfing) seems to have not confirmed, as Nifty bounced back sharply in the subsequent session. This market action could open Nifty to move towards the recent all time high of 13145 levels in the near term. Important support is placed at 12800 levels."

Manish Hathiramani, Proprietary Index Trader and Technical Analyst, Deen Dayal Investments

"The support of 12800 worked very well and the Nifty bounced swiftly to close above 12900. If we can get past 13050, we will be on our way to hit 13200. As long as 12800 does not break we could utilise all dips to buy into this strong upside rally."

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