Indian domestic indices NSE Nifty and BSE Sensex close higher as bulls stage a comeback, snapping a two-day losing streak. Although the markets opened flat, Nifty gained over 150 points to settle above 18,400 at 18,420. Sensex closed up by 0.76%, at 61,806. The broader markets shifted from red to green intraday, with Nifty Next 50 rising almost 1%. Adani Ports, Adani Enterprises, M&M, Eicher Motors and Power Grid were the top gainers on the Nifty 50 index today with Adani Ports gaining 4.05%. “Stabilizing after the previous session, domestic indices edged towards gains owing to optimistic cues from western markets. However, the IT sector stood out as an exception to the rally, as the growth guidance of the US IT sector signalled downgrades. Fears of a worldwide recession and mounting local COVID cases weighed heavily on Asian stocks,” Vinod Nair, Head of Research, Geojit Financial Services.
Osho Krishan, Sr. Analyst – Technical & Derivative Research, Angel One
Technically, there has been no substantial change in the market outlook as the bulls made a comeback from their support zone and showcased their resilience. Since we are still below 18,450 – 18,500, one more round of follow-up buying is needed to negate the breakdown witnessed on Friday. The undertone is expected to remain upbeat till Nifty sustains above the support of 18,200, followed by its sacrosanct demand zone of 18,100-18,000. Looking at the technical setup, until the index decisively surpasses 18,600, a range-bound movement could be continued in the comparable period. Simultaneously, the strategy of ‘buying near the support and staying light near the resistance’ would be suitable in the current situation, and participants are advised to keep a one step at a time approach for a while.
Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities
Optimism in European markets and short covering helped local benchmarks stage a smart bounce back even as other Asian market peers languished in negative territory. Despite the recovery, investors are lacking confidence after the recent US Federal Reserve’s indication of more rate hikes in the coming year. While markets may stay volatile in the coming sessions, selective buying will continue to be the mantra of investors till the worries of interest rates subside. Technically, the Nifty found support near 18,250 and reversed sharply thereafter. However, the short term formation is still on the negative side. As long as the index holds 18,300, a pullback rally could be seen and above the same, the index could move up to 18,550-18,575 levels or 20 day SMA. On the flip side, below 18,300, any uptrend would be vulnerable and below the same the index could slip till 18,200-18,150.
Deepak Jasani, Head of Retail Research, HDFC Securities
Nifty snapped a two day losing streak on Dec 19 going against the weak Asian cues. It closed 0.83% or 151.5 points higher at 18,420.5. Volumes on the NSE were the lowest in almost a month. Broad market indices rose less than the Nifty even as the advance decline ratio improved sharply to 1.51:1. IT stocks continued their downfall for the third consecutive session, while Auto and FMCG stocks attracted buying. Asia’s stock markets made a wobbly start to the final full trading week of 2022 while other global stocks attempted to recover from two weeks of losses sparked by concern that continued policy tightening by the US Fed and other central banks would trigger economic recession and hit companies’ profits. Nifty could now rise in this corrective move to 18,496, while 18,319 could offer support. Volumes could remain low as more and more participants are on year end holiday.