Global cues help Nifty record 3-week closing high

Sensex rallied nearly 300 points on July 1 to snap its 2-day losing streak while the Nifty reclaimed 11,850 helped by strong global cues.

The final tally on D-Street – Sensex rose 291 points to 39,686 and Nifty recorded 3-week closing high at 11,865, up 76 points from its previous close.

Global markets edged higher as trade tensions between the US and China eased that helped Nifty breakout above 11,800. On the domestic front, expectations of a pro-growth Budget, and steady auto sales data helped the rise.

On the sectoral front, the S&P BSE Realty index rose 2.5 percent, followed by the S&P BSE Auto index that gained 1.2 percent, and the S&P BSE Power index that was up 1.1 percent. The BSE Oil & Gas index closed 1.6 percent lower.

“Global market rallied on account of a trade truce between US-China and scope to maintain oil supply from OPEC. While sequential pick up in monthly auto sales and a likely proposal to simplify GST rate due to rise in revenue collection boosted the market sentiment,” Vinod Nair, Head of Research, Geojit Financial Services Ltd told .

“Investors are watchful ahead of Union Budget and hope that fiscal deficit is maintained in the long-term while short-term support is provided with minor dilution in FY20 with non-budgetary resources like RBI reserves, divestment and Public Sector Units,” he said.

Top Sensex gainers include companies like Tata Motors (up 3.2 percent), Bajaj Auto (up 2.9 percent), HDFC (up 2.5 percent), and IndusInd Bank (up 1.6 percent). On the losing front, Coal India, and HCL Technologies lost more than 1 percent each.

In terms of technicals, Nifty50 formed a bullish candle on daily charts. It closed above its crucial 5-day Exponential Moving Average (EMA), 13-EMA, and 20-EMA.

The trade set up is still not favouring bulls completely as multiple technical oscillators are in a sell mode on the daily charts, suggest experts. Even July 1 advance/decline ratio is almost flat.

“Unless Nifty closes above 11,911, momentum on the upside may not pick up. In case, bulls manage to push the said index beyond the hurdle of 11,911 then this rally can get expanded into the zone of 12,000-12,100,” Mazhar Mohammad, Chief Strategist – Technical Research & Trading Advisory, told .

Stocks in news:

Jet Airways shares were locked at 5 percent upper circuit after a media report indicated that Hinduja Group and Etihad Airways consortium is in the race to buy a cash-strapped airline.

Escorts shares rallied 6 percent after tractor sales in June surpassed analyst expectations.

Bajaj Auto shares gained more than 3 percent after auto sales in June beat analyst expectations.

The share price of Strides Pharma Science gained 3 percent as the company got approval for the sale of its investment in Arrow.

Global update:

Asian markets ended higher on July 1 after Donald Trump and Xi Jinping agreed to hold off on slapping additional tariffs to resume the trade talks between two big economies.

Shanghai Composite rose 2.22 percent at 3,044.90 and Nikkei added 2.13 percent at 21,729.97.

European markets are also trading higher after the US and China agreed to restart trade negotiations after a long lull.

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