Dear
Trader…
The Index continued its momentum amid volatility, after
opening positive, the Nifty future slipped at a low of 14662.55
points into weakness than recovered sharply
from the intraday low and finally rallied with an average
movement of 208.45 points and a strong rise of around 51.35 points and closed
around 14724.00 points on the back of positive-than-expected global recovery in
economy.
The
midcap index was up 0.98% and the small cap index was up 0.74%. Speaking of
various sectorial indices out of the total 3081 scrip’s traded and the number
of decliners was 1271 and the number of gainers was 1659 on the BSE.
Today, Volumes on the NSE were
higher than recent average. Among sectors, Metals Realty, Power, Auto, Pharma
and Consumer Durables index gained the most while telecom & Bank sectors came
under profit taking. Large caps are mildly underperforming, in which
financial stocks did contribute to the upside but weakness in kotak bank.
Currently, the infrastructure, steel, aluminum, metals, cyclic and
cement sectors have good valuations and are seeing huge growth in their profits
and it saws that stocks based bullish trend on the local economy..
The market may show a decline, but apart from that the market
structure is made up of bulls. The market is booming due to the success of
vaccines and the steady influx of FIIs, but there have been corrections in the
bullish phase in the past as well. This time too, along with the positive
factors, the bullish trade in stocks is likely to ease, so caution will be
required.
In the coming days, the end of February in F&O and the
resumption of the lockdown situation on the economic front and reports of a
worrying rise in unemployment in the country posed a major challenge for the
government. The appearance of another corona virus in India also had a negative
effect on sentiment.
We still maintain our stance that the trend is
volatile and pullback rally is in offing and selling may emerge. Hence trader
needs to be cautious at current level.
The Nifty valuations appear to be
stretched and the required earnings growth to sustain valuations is fairly
high. Hence, any negative development or adverse news flow might lead to a
sharp selloff…
Nifty future has to hold above 14808 zones to witness an up move towards 14888 – 14909 levels, while on the downside, major support exists at 14606 zones. Traders should focus on quality trades with decent margins of safety.
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