astute: Market Watch: Is there room for near-term upside for Dalal Street?

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Market Watch: Is there room for near-term upside for Dalal Street?

Welcome to ETMarkets Watch, the show about stocks, market trends and ideas for making money. I am Bhaskar Dutta and here are the headlines at this hour.

-A new coal crisis is looming in India
-EU considers coal and oil sanctions against Russia
– Recruitment activity in India increases by 16% in March
-Fuel prices rose for the 13th time in 15 days
-FMCG CEOs see inflation eating away at volumes
-Shanghai lockdown deepens after fresh push

Let’s take a look at what happened in Dalal Street today.

Domestic markets ended on a weak note on Tuesday as profit-taking by heavyweights HDFC Index and HDFC Bank dragged major indexes lower.

The HDFC twins had climbed around 10% each on Monday after announcing a merger of their operations, which would create a new giant in the financial sector.

A rise in global crude oil prices also eroded market risk appetite by heightening concerns about domestic inflation.

Investors are now awaiting the RBI’s policy statement on Friday, which comes amid a spike in global commodity prices following Russia’s invasion of Ukraine. Any sign of an end to the dovish policy could weigh on sentiment towards equities.

The BSE Sensex barometer hovered in a band of 718 points before settling 435 points lower at 60,176.50. The index has gained nearly 1,500 points over the past five trading days.

Its larger counterpart, the Nifty50, traded within a band of 174 points before closing down 122 points at 17,931.05. The index, which had crossed well above the 18,000 mark on Monday, could not sustain the momentum of Tuesday’s trading.

Even when the Sensex fell, the broader markets saw gains, with the BSE midcap and smallcap indexes rising 1.3% and 1.4% respectively. The India VIX Fear Gauge rose 3% to end at 18.49.

17 of 30 stocks on the BSE Sensex posted declines, with HDFC Bank shedding 3% to lead the losers. Bajaj Finserv and HDFC lost 2% each, while Kotak Mahindra Bank and Reliance lost 2% and 1.4% respectively.

NTPC led the winners, up 3.4%, followed by Power Grid, which added 2.5%. ITC rose 1.6%, while Titan rose 1.4%.

No less than 12 stocks reached the upper circuits during the session, while 3 tested the lower limits of the circuit. 80 stocks tested their 52-week highs during the day, while only 3 hit 52-week lows.

We have Ajit Mishra from Religare Broking to share his take on the action and the road ahead:
Welcome to the show sir:
1. Markets gave up the meager gains recorded earlier and ended in the red. After Monday’s huge rally, is there room for a near-term upside?
2. What are the market expectations for RBI policy this week? Is there fear of a change of position?

We also caught up with Prabhudas Lilladher’s Vaishali Parekh to decode the technical charts for you.
1. After breaking above 18,000 on Monday, the Nifty50 closed below the 17,950 level today. What do the spec sheets suggest about this?
2. Bank Nifty fares much worse than the overall index today. What is your outlook?

Asian markets ended mostly higher for the day. Major European markets were trading with discounts in the early hours of trading. Meanwhile, US stock futures were up, signaling a positive start for US equities later in the day.

That’s all for the moment. Check out ETMarkets.com for all the news, market analysis, investment strategies and dozens of stock recommendations. Enjoy your evening. Bye!

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