Taking Stock | After 8 days, market goes green; Sensex up 449 points, Nifty above 17,400

Indian equity benchmarks bounced back to end higher on March 1, snapping an eight-day losing streak amid buying across sectors.

At close, the Sensex was up 448.96 points, or 0.76 percent, at 59,411.08, and the Nifty was up 146.90 points, or 0.85 percent, at 17,450.90.

The market started March on a firm footing and extended gains as the day progresses. Good auto sales numbers and Rs 1.5 crore of GST collections in February added fuel to the rally.

“The benchmark indices finally tasted a tinge of green in today’s trade on the back of monthly automotive volume numbers and healthy GST collections in a shorter month. Even as the street reacted to the third quarter GDP numbers today, markets seem to look forward towards the 5 percent GDP during Q4,” said S Ranganathan, Head of Research at LKP Securities.

“Today’s session, however, surely witnessed investor interest in several PSU banking stocks, which had corrected quite meaningfully,” he added.

Adani Enterprises, Hindalco Industries, UPL, SBI and Axis Bank were among the biggest gainers on the Nifty. Britannia Industries, Power Grid Corporation, Cipla, BPCL and SBI Life Insurance lost the most.

All sectoral indices ended in the green. The Nifty metal index added 4 percent and the PSU bank index 3 percent. Nifty auto, bank, information technology indices were up 1 percent each.

Broader indices outperformed the benchmarks, with BSE midcap and smallcap indices rising 1.3 percent each.

On the BSE, metal index rose 2.6 percent. Auto, bank, information technology, oil & gas, capital goods, power and realty were up a percent each.

Equitas Small Finance Bank, Kirloskar Industries, Symphony and Sonata Software were among the stocks that touched their 52-week high on the BSE.

On the other hand, Adani Transmission, Angel One, BGR Energy, Coffee Day Enterprises, OnMobile Global, Quess Corp, Rolta India and Vimta Labs sank to their 52-week low.

Among individual stocks, a volume spike of more than 100 percent was seen in Hindustan Copper, Chambal Fertilisers and Chemicals and Indiamart Intermesh.

A long build-up was seen in Adani Enterprises, Rain Industries and Nalco, while a short build-up was seen in TVS Motor Company, Britannia Industries and Power Grid Corporation.

Outlook for March 2

Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities

Markets witnessed a relief rally after eight sessions of losses, as broad-based buying on the back of short covering and uptick in European and select Asian indices aided the sentiment.

The recovery was expected after relentless selling due to weak global cues and slowdown concerns.

A promising reversal formation and a strong bullish candle are indicating a further uptrend.

For traders, 17,350 would act as sacrosanct support and above it, momentum is likely to continue to 17,525-17,600. The uptrend, however, will be vulnerable below 17,350.

Jatin Gedia, Technical Research Analyst, Sharekhan by BNP Paribas

The pullback can continue over the next few trading sessions as the Nifty is oversold.

On the hourly charts, the index has broken out of a falling channel, which suggests that the Nifty is in a counter-trend pullback. The positive crossover on the hourly momentum indicator is in sync with the price action.

A pullback, if any, is likely to be just a relief rally and thus, we change our outlook on the Nifty to sideways.

The range of consolidation is likely to be 17,700–17,200. In terms of levels, 17,340–17,300 will act as crucial support, while 17,550–17,600 will be the immediate hurdle.

Markets started March on a positive note and gained nearly a percent, taking a breather after the recent fall.

After the initial uptick, the Nifty traded in a narrow range for most of the session but buying in select heavyweights kept the tone positive.

On the sectoral front, recovery in the IT and metal pack combined with continued resilience in banking played a crucial role.

We expect the rebound to extend further but a hurdle around 17,600 might cap the upside.

We reiterate our view to focus on identifying trading opportunities based on sectoral trends while keeping a check on leveraged trades. In the absence of a major domestic event, global cues will continue to induce volatility.

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