Nifty ends at record closing high; mid, smallcaps rally over 1%

It was indeed a terrific Thursday! Nifty came within striking distance of hitting fresh record highs, while the S&P BSE Sensex rallied by more than 300 points tracking strong global and local cues.

Let’s look at the final tally on D-Street – the S&P BSE Sensex rose 320 points to 41,626 while the Nifty50 closed with gains of nearly 100 points at 12,282 to end at a fresh record closing high.

The broader markets outperformed the frontliners. BSE Midcap index rose 1.23 percent, while BSE Smallcap index logged gains of 1.44 percent.

Most sectoral indices, barring IT, contributed to the move and ended in the green. The market breadth was also inclined strongly on the advancing side, in continuation of the recovery in the midcap and smallcap space.

India’s factory activity expanded at its fastest pace in seven months in December as a jump in new orders prompted companies to ramp up production, a private business survey showed on Thursday.

The Nikkei Manufacturing Purchasing Managers’ Index, compiled by IHS Markit, rose to 52.7 in the final month of 2019 from November’s 51.2.

Experts are of the view that GST collections, robust CAPEX plan from the govt, and the announcement of US-China deal signing date pushed the market higher led by sectors such as infra, commercial vehicles, cement and metals.

“Markets rebound sharply and gained nearly a percent, thanks to encouraging local cues and supportive global markets. Participants took note of GST collection figures which remained above 1 lakh mark for the second consecutive month,” Ajit Mishra, VP – Research, Religare Broking Ltd told Moneycontrol.

“The market breadth was also inclined strongly on the advancing side, in continuation of the recovery in the midcap and smallcap space,” he said.

Top Nifty gainers – Tata Steel, UltraTech Cements, Tata Motors

Top Nifty losers – BPCL, Bajaj Auto, Eicher Motors

Stocks & Sectors:

Sectorally, the S&P BSE Metal index rose 2.6 percent, followed by the S&P BSE Capital Goods up 2.1 percent, and Infrastructure index closed with gains of 1.9 percent.

Volume spike of 300-600 percent was seen in stocks like Apollo Tyres, Grasim, ACC, Sun TV, Ramco Cements, Ambuja Cements, and UltraTech Cements

Long Buildup – Ramco Cement, Apollo Hospital, Tata Steel, SAIL, Tata Motors

Short Buildup – Sun TV, PVR, Eicher Motors, MindTree

Stocks in News

Prakash Industries: Prakash Industries share price surged 20 percent on January 2 as the company secured allocation of long-term coal linkages of 1.69 lakh MT per annum.

Auto stocks end mixed: Share price of Ashok Leyland and Tata Motors gained 3-5 percent on January 2. Citi maintained its buy call on Tata Motors.

Eicher Motors shed 2 percent after Royal Enfield sales down 13 percent at 50,416 units against 58,278 units.

Apollo Hospitals: Share price of Apollo Hospitals jumped over 4 percent on January 2 after the company got approval for Apollo Munich deal from CCI, RBI and IRDA.

Clariant Chemicals: Clariant Chemicals India share price rose more than 4 percent on January 2 as the company announced completing the sale of its additives business.

Sterlite Technologies: Sterlite Technologies share price gained 6 percent on January 2 after the company bagged a Rs 1,800-crore project for a high-speed rural broadband network in Telangana.

PNB: Shares of Punjab National Bank (PNB) climbed over 3 percent on BSE on January 2 after reports emerged that Nirav Modi’s assets mortgaged with PNB will be given back to the bank.

Technical Recommendations:

Nifty formed a bullish candle on the daily charts

It has negated all the previous negative patterns as bulls look in a firm position to take the index to fresh record highs

India VIX fell down by 0.95 percent at 11.49 levels. Lower volatility suggests that bulls are holding the tight grip on the market and every small decline is being bought.

Experts feel that once the Nifty registers a breakout above 12,293 levels, the next big resistance is placed around 12,400

Intraday traders can look for going long if Nifty sustains above 12,300 levels for more than 30 minutes on Friday, and look for a target of 12,390.

Contrary to this, weakness in Nifty can be expected on a strong close below 12168 levels.

Three levels: 12195, 12289, 12350

Max Call OI: 12500, 12200

Max Put OI: 12000, 11500