Market rises for 3rd day in a row on positive global cues

Indian equity benchmarks logged strong gains on December 13 buoyed by positive global sentiment as hopes of an orderly Brexit grew stronger after a landslide election victory for British Prime Minister Boris Johnson.

Positive signals due to the US-China trade deal also influenced the mood.

Sensex settled 428 points, or 1.05 percent, higher at 41,009.71 while Nifty closed the day with a gain of 115 points, or 0.96 percent, at 12,086.70. Midcaps and Smallcaps, too, witnessed decent gains but underperformed the benchmark Sensex. BSE Midcap closed 0.92 percent up and the Smallcap index settled 0.82 percent up.

“Many positive triggers came together today to keep the market up. Possible development around the US-China trade deal, UK election results, likely inflows from Essar Steel case and a strong uptick in global indices were among the factors that boosted the sentiment,” said Rusmik Oza, Senior VP & Head of Fundamental Research at Kotak Securities.

As many as 24 stocks ended in the green in the 30-share pack Sensex. Axis Bank, Vedanta, State Bank of India, Maruti Suzuki and IndusInd Bank emerged as the top gainers in the Sensex index.

On the other hand, Bharti Airtel, Kotak Mahindra Bank, Bajaj Auto, Asian Paints, HDFC Bank and Hindustan Unilever ended as the losers in the Sensex kitty.

For the week, both Sensex and Nifty climbed 1.4 percent.

Top Nifty gainers – Axis Bank, Vedanta and Hindalco Industries

Top Nifty losers – Dr. Reddy’s Laboratories, Bharti Airtel and Zee Entertainment Enterprises

Stocks and sectors

Barring BSE Telecom, all sectoral indices settled with gains, with the metal pack jumping 2.30 percent, followed by Realty, Teck, Capital Goods, Auto, IT, Industrials and Basic Materials, each gaining over a percent.

BSE Telecom closed with a loss of 1.60 percent, with Bharti Airtel, GTL Infrastructure and Reliance Communications as the top drags.

Volume spike of 200-400% was seen in Dr. Reddy’s Laboratories, Balkrishna Industries, MRF, Concor and Apollo Hospitals.

Long Buildup – Union Bank of India, Indiabulls Housing Finance and Canara Bank.

Short Buildup – Dr. Reddy’s Laboratories, Jindal Steel and Bharti Airtel

Stocks in the news

Banking stocks rally: PSU banks were among top gainers after media reports suggested banks are likely to get payments from Essar Steel resolution this month.

Aviation stocks gain: Share prices of airline companies including Jet Airways, and SpiceJet gained 1 to 4 percent, a day after data showed an increase in domestic passenger traffic in the previous month. However, IndiGo shares erased the gains to close 1.44 percent down.

Tata Motors: Tata Motors share price gained 2 percent, amid hopes that the Brexit could happen by January after a big win of Boris Johnson is the UK election.

Bank of Baroda: Bank of Baroda share price climbed 4 percent after the company signed a share purchase agreement with Ansa Merchant Bank to sell the business of Bank of Baroda Trinidad & Tobago.

Premier Explosives: Share price of Premier Explosives zoomed over 12 percent after the company got a licence from the Telangana government to work on a factory at Katepally near Hyderabad.

Technical view

Nifty formed a bullish candle on daily charts.

The sharp upside momentum continued in Nifty today for the third consecutive sessions and closed the day with decent gains. A long bull candle was formed today with back to back opening upside gaps (both the upside gaps are unfilled). Technically, this pattern indicates a sharp comeback of bulls from the lower levels.

“Nifty as per weekly timeframe formed a long bull candle with lower shadow. This candle pattern was formed immediately after the formation of a bearish engulfing type pattern in the last week. This is a positive indication and one may expect further upside in the short-term. A sustainable move above 12,158 could nullify the negative implication of bearish engulfing,” said Nagaraj Shetti, Technical & Derivative Analyst at HDFC securities.

Shetti said one may expect Nifty to reach up to 12,150-200 levels by the next week and there is a possibility of an emergence of selling pressure again around all-time highs.

Three levels: 12023.6, 12098.8, 12115.8

Max Call OI: 12,000, 12,200

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