Sensex Rebounds After One-Day Blip Led By Index Heavyweights Banks, IT: Market Wrap
Indian equities end higher after softer-than-expected U.S. inflation print raised hopes that Fed will hike rates at a slower pace.
Indian equity benchmarks closed higher after a softer-than-expected U.S. inflation print raised expectations that the Federal Reserve will hike interest rates at a slower pace.
The S&P BSE Sensex climbed 0.76% to 59,262.33, its highest in four months. The NSE Nifty 50 closed 0.6% higher at 17,640.75, its fourth straight session of gains.
Housing Development Finance Corp. Ltd. contributed the most to the index gain, up 2.4%. Axis Bank Ltd. rallied the most, up 2.7%. Of the Nifty 50 constituents, 32 shares rose, while 18 fell.
"The lower-than-expected U.S. CPI numbers have catalysed a rally in global markets on the hope that the U.S. Fed may go slow on rate hikes," Deepak Jasani, head of retail research at HDFC Securities Ltd., wrote in a note.
According to Shrikant Chouhan of Kotak Securities Ltd., traders have also been drawing comfort from the falling crude oil prices and FII inflows into the local shares in the last few sessions.
Technically, the Nifty is trading near its important resistance level and has also formed a small bearish candle. For traders, 17,600 would be the key level to watch out for, while the overall chart structure suggests that if the market sustains above the same, then breakout continuation formation could continue till 17,700-17,750. On the flip side, a sharp intraday correction is possible if the index trades below 17,600. Below which, the index could slip till 17,540-17,450.Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities Ltd.
In earnings, of the 44 Nifty companies that have so far announced results for the quarter ended June, an equal number have missed and beat analyst estimates.
Banks, IT Stocks Led The Rally
The Bank Nifty index continued its strong up move on the back of positive global cues. The index surpassed the immediate hurdle of 38,400 which will now act as support on the downside. The upside resistance is placed at 39,000 and if breached on a closing basis will see further upside towards the 40,000 level. The index is trading in overbought territory and a profit booking scenario cannot be ruled out from the current levels.Kunal Shah, Senior Technical & Derivative Analyst, LKP Securities