Today’s Market Summarised

Once again selling near the higher ranges of the market.

Nifty opened the day flat at 15,811 and was very volatile. But just after 10 AM, the rally in Banks and IT got some strength. From the day-low, the index went up more than 110 points. The resistance at an all-time high was not tested, and Nifty fell to close the day at 15,853, up 41 pts or 0.26%.

Bank Nifty opened at 35,590 with a gap-down and moved down. However, it took support and shot back up with strength from private banks. The zone at 35,800 was once again tested and failed to break and heavy selling took the index back down. Bank Nifty closed at 35,668, down 5 points or 0.01%

IT stocks performed the best with Nifty IT(+3.16%) up in the day. Nifty Realty(-0.95%) moved down. All other sectors consolidated.

Most Asian markets closed in the red. European markets are also trading in the red.

News Picks

IT stocks were highly bullish with the four top gainers in Nifty 50 being Tech stocks. Yesterday, MindTree’s good results brought back some confidence into the industry which was let down by Q2 results from TCS.

Wipro(+7%) was the top-gainer, almost reaching back to its 52-week highs ahead of its results announcement tomorrow.

TechM(+2.7%), HCLTech(+2.2%), Infy(+2%) and TCS(+0.85%) followed. Other IT stocks including Mphasis(+8.4%), MindTree(+8.3%), CoForge(+4.9%), LTI(+4.9%), OFSS(+3.4%) and Happiest Minds(+9.8%) also gained. No stocks from the Nifty IT index closed in red.

Also, Infosys has just published its results now with net profits at Rs 5,195 crores, up just 2% QoQ and below expectations.

LT(+2%) turned bullish with Jefferies setting a target of 1,900 for the stock. It is at a good resistance zone near 52-week highs.

Maruti(-1.3%) fell after it announced a projected Rs 18,000 crore plant for the production of its upcoming SUV lineup. Other auto stocks also generally remained weak even after the SIAM Data showed India’s June Local Car sales rose 118% to 1,21,378 units YoY.

Quess closed 5.7% down after the Income Tax Department conducted a survey at the company’s subsidiary Terrier Security Services.

CEAT(+5.2%) moved up after it got selected to supply tyres for M&M’s new seven-seater Bolero Neo.

JSW Energy is planning to raise up to Rs 5,000 crore via equity shares, bonds and other such securities. The stock closed 3% up.

ITC announced it is entering into the Boutique Lifestyle Hotel Segment with a new brand. The stock closed 1.1% up

The government is set to discuss asset monetization of BEML(+0.6%), MTNL(+4.8%) soon. BEML moved 4.5% from day low to day high.

CAMS(14.7%) continued bullishness from yesterday along with CDSL(+3.9%).

Some textile stocks moved higher as the Government approves an extension for a tax rebate on exports. ICIL(+9.4%), WELSPUNIND(+4.3%) and KPR MILL(+1.2%)  gained. Kitex(+10%) continued the upper circuit rally of this week.

Markets Ahead

India’s June Wholesale Price Index Inflation came out at 12.07%, better than the estimate of 12.18%. Still a very high rate.

Yesterday, FIIs turned net buyers but just for a small amount. Nifty was all set to move up with power from short sellers at 15,800 trying to cover their losses.

But the short sellers did not let go. Bank Nifty at exactly 35,800 once again saw profit booking, for the 5th time in the last 4 months. It is a level that Bank Nifty has not crossed since March 14th.

IT stocks supported the market with Infy and Wipro alone contributing nearly 40 points to Nifty. When this happened Reliance and HDFC Bank saw selling so as to keep Nifty flat.

Reliance continues to find difficulty in crossing 2,100 and HDFC Bank closed just below the 1,500 level. 

With tomorrow being the weekly expiry, there is a chance for volatility. Compared to the month of June, July is giving more quick movements. 

But even though I see some bullishness in the market, not expecting a fresh high for Nifty tomorrow. This could still change if Bank Nifty crosses 35,800 after which the next target would be 36k or if Global Markets also go volatile.

What do you feel? Is the all-time high for Nifty going to be broken tomorrow? Remember that it is just 65 points away from today’s close and 36 points away from today’s high!