Sensex today: After scaling from the historic peak of 20,000 a day earlier, domestic benchmark indices extended their gains on Tuesday, with the Nifty index rising above 20,100 and the Sensex index gaining 350 points to 67,435.
L&T, ICICI Bank, JSW Steel, Ultratech Cement and Sun Pharma led gains on BSE Sensex, rising 0.7-3 percent. Meanwhile, Adani Ports, HUL, Adani Enterprises, Nestle and M&M were the top laggards in the benchmarks.
Broader markets also opened higher. The BSE MidCap and SmallCap indices rose up to 0.34 per cent.
Parth Nyati, Founder, Tradingo, said: The Nifty 50 index has been on a bull run since the beginning of the year and has touched an all-time high of 20,000 points. The market is currently trading at a price-to-earnings ratio of around 22, which is slightly above the historical average.
Since the low of 16828 on March 23, Nifty has risen 18% on the back of inflows of Rs by DII. 34,000 Cr (approximately) during this period. Meanwhile, the mid- and small-cap indices have seen an even more substantial recovery, each up about 41 percent and 47 percent respectively.
However, despite this significant rally and rising values of local stocks, there are concerns due to weakness in the global market. These problems are caused by a strong US dollar and rising US government bond yields. Last week, the number of people in the US filing for unemployment benefits was lower than expected, raising concerns about the possibility of interest rates rising. Moreover, China’s trade balance data shows weakness, further strengthening the US dollar.
As our Prime Minister said, this is India’s Amritkal, so the medium to long term opportunities in the Indian stock market will be fantastic. Any correction due to global factors will be a good buying opportunity in sectors like auto, banking, food, IT, etc.
Technically, the Nifty continues strong bullish momentum with 20100 and 20150 being resistance levels. The period 19850–19720 is an immediate demand zone, while the 19500 50-DMA is a key support level. The bullish momentum will continue until the Nifty closes near the low of the day.
Banknifty witnessed a breach of the 45,000 resistance mark, with 45,700 being an immediate resistance zone. Above 45700 we can expect a move towards the 46300 level. The downside is that 45000 is an immediate support level while 44800 is a major support level.
Global markets
US stocks rose overnight with the Nasdaq index jumping 1.14 percent, the S&P 500 gaining 0.67 percent and the Dow Jones rising 0.25 percent.
In Asia, Hong Kong’s Hang Seng fell about 1 percent. Stocks in mainland China were also weak, with the CSI 300 down 0.14 percent. South Korea’s Kospi fell 0.6 percent, while Japan’s Nikkei bucked the trend with a gain of 0.13 percent.