Benchmark indices closed in the green on Tuesday, led by metals.

After opening on a positive note, tracking global cues, the market extended gains through the day ahead of the F&O expiry on Thursday. The broader market also rebounded sharply as mid-caps and small-caps gained.

The BSE Sensex, after briefly surpassing the 56,000-mark during the day with an intraday high of 56,023.22, closed at 55,958.98, up 403.19 points or 0.73 per cent. It hit an intraday low of 55,536.84. The Nifty 50 closed at 16,624.60, up 128.15 points or 0.78 per cent. It hit an intraday high of 16,647.10 and a low of 16,495.30.

Market breadth turns positive

The breadth of the market turned positive as many as 2,149 stocks advanced on the BSE, as compared to 1,026 stocks that declined and 123 remained unchanged. Further, 344 stocks hit the upper circuit as compared to the 314 stocks that were locked in the lower circuit. Besides, 139 stocks touched a 52-week high and 47 touched a 52-week low.

Near-term outlook bullish for Sensex, Nifty

Bajaj Finserv, Hindalco, Adani Ports, Tata Steel and Bajaj Finance were the top gainers on the Nifty 50 while Nestle India, Britannia, Asian Paints, HDFC and Infosys were the top laggards.

Vinod Nair, Head of Research at Geojit Financial Services, said, “Strong rebound in broader markets along with favourable global cues bolstered optimism in Dalal Street, led by metal, banking and realty stocks.”

“Metal stocks led the rally as value buying was witnessed after deep sell-off during the past four trading sessions due to weak iron ore futures across the globe. The USFDA granted full approval to the Covid-19 vaccine by Pfizer and BioNTech, which pumped in hopes of faster inoculations,” added Nair.

Sensex, Nifty end firm, but broader market slumps further

According to Dr VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services, “The dominant trend in the market in August so far has been the weakness in the broader market and a flight to the safety of large-caps, particularly IT and defensives like FMCG stocks.

“The preference for defensives such as HUL, Nestle, Britannia and Godrej Consumer also reflects growing concerns about the high valuations and the possibility of a sharp correction. Nifty is likely to face resistance at higher levels since FIIs are in sell mode. FIIs sold for the fifth consecutive day, with ₹1,363 crore selling in equity yesterday. The risk-reward ratio now is not favourable to the buyers.”

FMCG, IT under pressure

On the sectoral front, all indices except Nifty IT and Nifty FMCG closed in the green. While metals led the rally, financials, realty, pharma, healthcare, and oil and gas stocks gained.

Nifty IT was down 0.24 per cent at closing while Nifty FMCG was down 0.67 per cent. Nifty Metal was up 2.90 per cent. Nifty Bank was up 1.67 per cent while Nifty Financial Services was up 1.39 per cent. Nifty PSU Bank was up 1.83 per cent while Nifty Private Bank was up 1.54 per cent. Nifty Realty and Nifty Oil and Gas were up 1.83 per cent and 1.68 per cent, respectively. Nifty Pharma and Nifty Healthcare Index were up 1.28 per cent each.

Rebound in larger markets

After witnessing heavy selling in the previous session, mid-caps and small-caps recovered to end higher.

Nifty Mid-cap 50 was up 1.79 per cent at closing while Nifty Small-cap 50 was up 1.95 per cent. The S&P BSE Mid-cap was up 1.52 per cent while the S&P BSE Small-cap was up 1.69 per cent.

The volatility index softened 3.63 per cent to 13.19.

Published on August 24, 2021