A decisive move only above 17750-17800 levels could change the negative trend setup for Nifty, say analysts
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Indian stock markets closed higher today, snapping a four-session losing streak. Metals and energy stocks led the recovery while broader markets outperformed significantly. The blue-chip NSE Nifty 50 index ended up 0.5% at 17,503.35 and the benchmark S&P BSE Sensex rose 0.34% to 58,664.33. Both the indices had lost nearly 4% each over the last four sessions.
The Nifty metal index ended the session 3.3% higher, supported by a surge in China's benchmark iron ore futures. Among metal stocks, Vedanta rose nearly 8% while SAIL and JSW Steel jumped rising 3.45% and 4% respectively.
Brent crude futures fell 69 cents, or 0.87%, to $79.01 a barrel as the United States is expected to announce a loan of crude oil from its emergency stockpile as part of a plan with major Asian energy consumers, including India, to lower energy prices.
Among stocks, digital payments start-up Paytm ended up 9.94% after two sessions of sharp falls, while shares of SpiceJet hit an over two-month high after the low-cost airline said compensation from Boeing for grounded MAX planes will be in cash and aircraft.
Ajit Mishra, VP - Research, Religare Broking Ltd, said participants shouldn’t read much into today's rebound and wait for further clarity. “Apart from the global cues, the scheduled monthly expiry would keep the volatility high in the coming sessions. We thus recommend continuing with a cautious stance and maintaining a hedged approach," he said.
Broader midcap and smallcap indices rose 1.81 per cent.
Manish Hathiramani, proprietary index trader and technical analyst, Deen Dayal Investments, said: “While we closed in the green, it cannot be summarized that we are out of the bearish woods. The Nifty would need to get past the 17800-17900 levels to restart the upward trajectory. Until then the markets are sensitive to price and volume and a little shift in the sentiment can result in a downward spiral which can take the index to 16900-17000. Extreme caution is advised as we are in volatile times."
PowerGrid was the top gainer in the Sensex pack, rising around 4 per cent, followed by NTPC, Tata Steel, Bharti Airtel, Sun Pharma and Bajaj Finserv. On the other hand, IndusInd Bank, Asian Paints, Infosys, Bajaj Auto and Maruti fell up to 2.59 per cent.
Nagaraj Shetti, Technical Research Analyst, HDFC Securities, said: “A decisive move only above 17750-17800 levels could change the negative trend setup towards positive and one may expect further upmove ahead. Immediate support is placed at 17220. Any weak upside bounce in the next 1-2 sessions could result in Nifty to revisiting present low of 17200 levels."