Indian market remained volatile on December 9 but the bulls dug in and helped benchmark indices close in the green but the fear indicator, India VIX, climbed 7 percent, posing a challenge to the bulls.
The final tally on D-Street: the Sensex rose 42 points to 40,487, while the Nifty closed 16 points higher at 11,937.
The benchmark indices swung both ways before closing flat. Sectorally, action was seen in energy, oil & gas, auto, and metal stocks, while profit-taking was evident in IT, realty, and capital goods space.
The broader market closed mixed – the BSE Midcap index was up 0.11 percent and the BSE Smallcap index was down 0.44 percent.
India VIX, which is a volatility index based on the Nifty Index Option prices that measure market volatility over the next 30 calendar days, rose by 7.5 percent to 14.67 levels.
Although India VIX is often called the “fear gauge”, a high India VIX is not necessarily bearish for stocks. Instead, India VIX is a measure of perceived market volatility in either direction. Historically, we have seen an inverse correlation between India VIX and the Nifty, hence some more volatility cannot be ruled out.
Markets will keep an eye on macroeconomic data on inflation, and on the global front, any positive developments on the US-China trade talks will give a much-needed boost to the markets.
“We continue to maintain our cautious stance on the Indian markets, considering the recent run-up and stretched valuations. Going forward, market participants would keep a close watch on CPI, IIP and WPI numbers scheduled to release this week,” Ajit Mishra, VP – Research, Religare Broking Ltd, told Moneycontrol.
Top Nifty gainers: Adani Ports, HDFC, and BPCL up over 2% each
Top Nifty losers: HCL Tech, Cipla, and TCS fell 1-3%
Stocks & Sectors
Sectorally, the BSE Energy index was up 1.06% followed by the BSE Oil & Gas index, which gained 1.01 percent, and the BSE Auto index rose 0.75 percent.
On the losing front, sectors that remained under pressure include IT, down 1.02 percent followed by the BSE Realty index that fell 1.02 percent, and the Capital Goods index was down 0.78 percent.
Volume spike of 100-200% was seen in stocks like Century Textiles, Cipla, TVS Motor, and CESC.
Long Buildup – Century Textiles, Tata ELxsi, Dish TV
Short Buildup – Ujjivan Financial, Cipla, SBI
Stocks in news
Maruti Suzuki: Shares of Maruti Suzuki India rose 2 percent on December 9 after the auto major increased production in November.
Maharashtra Seamless: Maharashtra Seamless gained nearly 3 percent after the company won a Rs 500-crore order from Oil and Natural Gas Corporation.
SPML Infra: SPML Infra share price rose 4 percent after the Gurgaon-based company bagged Rs 218.18 crore worth of orders in Uttar Pradesh and Haryana.
Sun Pharma Advanced: Sun Pharma Advanced Research share price added 5 percent on the withdrawal of complaints filed against the company.
Shaily Engineering: Shaily Engineering Plastics share price ended almost 9 percent in the red after the company’s plant at Rania was searched by GST authorities.
The Nifty snapped a two-day losing streak and closed with an indecisive Doji formation on the daily charts.
In the next trading session, if the Nifty slips below 11,888, then it can slide towards its 50-day simple moving average placed at 11,740.
Positional traders can continue with their short positions for a target of 11,740, say experts.
Intraday traders can consider fresh shorting if the index trades below 11,888 for at least 30 minutes in the next session and look for a target 11800, they say.
Three levels to track on Tuesday – 11,888, 11,981, 12158
The Nifty Bank closed the day at 31,316 with minimal loss and formed a Doji pattern on the daily chart
The immediate support for the index is coming near 31,250-31,050 zone and resistance close to 31,550-31,750 zone, say experts.Are you happy with your current monthly income? Do you know you can double it without working extra hours or asking for a raise? Rahul Shah, one of the India’s leading expert on wealth building, has created a strategy which makes it possible… in just a short few years. You can know his secrets in his FREE video series airing between 12th to 17th December. You can reserve your free seat here.