Nifty holds 11,900 after a tug of war between bulls and bears

The tug of war between the bulls and the bears continued throughout the day on June 13. The day ended with a consolation prize for both parties as indices closed mixed.

Nifty managed to close in the green above 11,900 while the Sensex closed marginally in the red. The Nifty50 moved in a 100-point range during the day.

The final tally on D-Street – Sensex closed 15 points down at 39,741 while Nifty closed 7 points higher at 11,914.

Market was volatile and settled almost unchanged amid mixed cues. Initially, weak global markets and mixed macroeconomic data were weighing on the sentiments.

However, recovery in select index majors in the latter half pared the intraday loss and aided flat close in the end.

“Though the benchmark index is somehow holding around its record high, broader indices are under tremendous pressure. It shows lack of buying interest among the participants, given uncertain global markets and not so encouraging domestic cues,” Jayant Manglik, President – Retail Distribution, Religare Broking Ltd told Moneycontrol.

Among sectors, the S&P BSE Realty index rose 0.6 percent, followed by the S&P BSE Power index which was up 0.56 percent, and the S&P BSE Consumer Durable index that rose 0.3 percent. On the other hand, the S&P BSE IT index fell 0.78 percent, followed by the S&P BSE Auto and Healthcare index.

Broader market underperformed as the S&P BSE Midcap index fell 0.33 percent while the S&P BSE Smalllcap index was down 0.5 percent.

Nifty is consolidating in a narrow range of 11,800-12,000 so far in June. Analysts advise traders to wait for a breakout or a breakdown before initiating any trade in either direction that could eventually get over before or after the budget.

“Markets rolled southwards but there was some recovery by the end of the day. It was not only banks and NBFCs that faced the intraday carnage but other pockets too showed signs of weakness. Broader indices especially the midcaps witnessed selling pressure,” Umesh Mehta, Head of Research, Samco Securities told Moneycontrol.

“Traders should play this correction smartly and start taking long positions only after the volatility subsides and markets form a base since broadly we are in a bull market,” he said.

Mehta further added that once this correction phase is over in terms of price and valuation, there would be good buying opportunities even for the investors. “Well, no one can predict the end to this correction, it can be before or after the Budget announcement,” he said.

Stocks in news:

Shares of Indiabulls Housing soared more than 11 percent after a writ petition alleging financial misdeeds against the mortgage lender was withdrawn.

Shares of Reliance Capital dropped as much as 3.5 percent after former auditor Price Waterhouse & Co (PwC) alleged irregularities in the books of accounts of the company.

Yes Bank shares plunged 13 percent and IndusInd Bank tanked 5 percent after global brokerage house UBS slashed price target sharply by 47 percent and 18 percent, respectively, citing weak earnings going ahead.

Shares of Jet Airways plunged more than 16 percent after stock exchanges decided to impose trading restrictions on the beleaguered airline’s stock.

Global update:

Asian markets ended mixed on the back of overnight decline on Wall Street. Hang Seng ended marginally lower at 27,294.71, Nikkei was down 0.46 percent at 21,032 and Shanghai Composite was up at 2,910.74.

European indices are trading higher with FTSE up 0.35 percent at 7,393.04, CAC rose 0.3 percent at 5,390.78 and DAX was up 0.6 percent at 12,189.45.Subscribe to Moneycontrol Pro and gain access to curated markets data, exclusive trading recommendations, independent equity analysis, actionable investment ideas, nuanced takes on macro, corporate and policy actions, practical insights from market gurus and much more.