Mid Market commentary May 25
Indian markets opened with a gap-up, offsetting a 4 days losing streak. Markets continued to rise after closing marginally higher in the previous session followed by positive European markets.
Nifty and SENSEX opened 63 and 127 points up, respectively, from the previous close. The optimism was led by the positive global markets and buoyant results from the frontliner Tech Mahindra.
European markets rallied amid surge in banking, insurance and retail stocks while Euro depreciated against USD. U.S. markets closed higher yesterday owing to positive housing data. Thereby Asian markets too opened higher where Nikkei225 rose nearly 1.75 per cent while Yen fell against USD.
On the domestic front Tech Mahindra, IT Giant has posted better than expected rise in its top line and net profits. The stock has surged more than 7 per cent and pulled the markets to trade in green making up for losses made by Cipla post poor results.
Market breadth remained highly positive with 1481 advances; and 714 declines. Midcap and Smallcap indices are trading more or less in line with the benchmark indices.
All sectors are positive wherein Banks, Financial services and IT remain at the forefront of the move, each gaining 2 per cent or more. Only Pharma remains marginally up with 0.3 per cent gains.
Top Nifty gainers: Apart from Tech Mahindra, ICICI Bank, IndusInd Bank and HDFC remained the top gainers with 3 per cent plus gains. Cement giants Ambuja and ACC followed the toppers’ list with 2.8 per cent gains.
Top Nifty losers: Cipla is the only stock trading in red with 4.7 per cent downside.
Nifty hit a low which was just above its 100 days EMA support level at 7703 in the previous session. Now we hold resistances at 7940 followed by 8000 levels which is an inverse Head & Shoulder breakout level for the Nifty. On the contrary if 7715-7700 is broken we hold 7675 as the support if Nifty falls below 7860-7815.
Stocks to watch:
Ruchi Soya: The stock plunged 15 per cent after the company was barred by SEBI from the securities market for alleged fraudulent activities in trading of castor seeds.
Bharti Airtel: The stock of Bharti Airtel is likely to remain in focus after it announced completion of a deal worth Rs 4428 crore with Videocon Telecommunications Ltd., to acquire Videocon’s spectrum in six circles.
Mahindra and Mahindra: M&M today rose by 1 per cent after the company incorporated a subsidiary in Nigeria to penetrate into the West African region.
Cadila Healthcare: Cadila Healthcare Ltd. has informed that Zydus has received final approval from the USFDA for Voriconazole Tablets.
Tata Steel/ L&T: We have the frontline stock results to watch out today. If the results are out post market hours, we could see the impact in tomorrow’s market movement.