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Pharma & metal stocks help Nifty in scoring; Put addition witnessed in 14,900 strike

Karan DSIJ
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Pharma & metal stocks help Nifty in scoring; Put addition witnessed in 14,900 strike

Update: The key benchmark indices managed to hold onto their early gains with Nifty trading near 14,950 levels while Sensex was trading above 49,500.    

All the sectoral indices were trading in green with Nifty Pharma & metal being the top gainers. 

Broad Put addition was seen in Nifty at 14,800-14,900. The 14,900 strike price saw the addition of 27.77 lakh shares in open interest while 14,800 strike price witnessed the addition of 15.78 lakh shares.

 

The PSU stocks are seen outperforming with Gujarat Mineral Development Corporation (GMDC) being the top PSU gainer, up by more than 15 per cent, followed by Hindustan Copper up by 10 per cent. BHEL and MOIL are up by more than 8 per cent each while NMDC is up by nearly 7 per cent.  

BSE PSU index (up by more than 2 per cent) is the top-performing index in today's trade.  

Meanwhile, Coal India is the top Sensex gainer, which has gained more than 5 per cent.  Divi’s Lab, Dr Reddy's & Sun Pharma are the top-performing pharma stocks in Sensex basket.  

Dabur is the worst performing Sensex stock, down by more than 2 per cent, followed by UltraTech Cement and Grasim, which are down by more than 1 per cent each in today's session.  

BSE Small-Cap index is outperforming Sensex, up by more than 1 per cent in today's trade while the Mid-cap index is up by 0.85 per cent and Sensex is up by 0.70 per cent.  

KIOCL, BHEL, and Aditya Birla Capital are the top mid-cap gainers in today's session while SPARC, GMDC, and Praj Industries are amongst the top small-cap gainers.  

 

Indian market started off the week with a gap down, weighed down by domestic factors. However, Nifty managed to recover from the lower levels and remained largely trending on the upside, barring one trading session of the week. As a result, it ended the week up by 192 points or 1.31 per cent. The broader markets outperformed the benchmark indices with Nifty Mid-cap and Small-cap gaining 1.45 per cent and 2.01 per cent, respectively.   

Nifty on Friday formed a Doji candlestick pattern on the daily chart as the closing was near its opening levels while on the weekly chart, it had formed a bullish candle.   

Nifty has reached near its make-or-break level of 14,880, as in the recent past, it had tested the level of 14,880 several times while the bulls have been failed to close above the level with authority. As a result, all eyes would be around this level as a decisive breakout above this could open gates for 150-200 points upmove in the near term.   

Meanwhile, the formation of the Doji candlestick pattern on the daily chart is once again making the bull camp skeptical above the continuation of upmove as Doji reflected indecisiveness. However, the bull camp would take solace from the fact that Nifty has now closed above the 50-DMA while daily MACD generated a buy signal after a long gap, indicating that the underlying trend may be strengthening in bulls’ favour. Despite this, we would say that Nifty may not be completely out of the woods. Wondering as to why are we saying so? Though over the last couple of days, the index has exhibited a buoyant undercurrent yet at the same time, it is important to understand that attempting to breakout is one thing and actually breaking out is another. At present, the index is attempting to breakout and unless it registers a strong close above the levels of 14,880, it would not be completely out of the woods.   

With frontline indices displaying complete boredom, the broader market is clearly buzzing. Hence, we would reiterate to keep the focus on the stock-specific themes. And for the coming weeks, pharma stocks could be in the limelight as India’s pharmaceutical industry clocks 51.5 per cent sales growth in April, says AIOCD-AWACS.   

So, for traders, it’s important to watch out the price action around 14,880 levels for Nifty and a decisive move above this level could trigger a trending move. Until then, traders should prefer themes such as pharma, agri-commodities, and textile-related stocks for long positions.   

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