Midcap index hits 7-month high! Sensex touches 42k, Nifty closes above 12,350

It was a landmark day for Indian markets as the S&P BSE Sensex hit a fresh record highs above 42,000 for the first time in history on January 16 while the Nifty50 inched closer towards 12,400 levels.

The S&P BSE Sensex hit a fresh record high of 42,059 while the Nifty50 hit a lifetime high of 12,389. But, indices ended off record high levels.

The S&P BSE Sensex completed the journey from 41,000 to 42,000 in just 36 sessions led by gains in Tata Steel (up 18 percent), Infosys (up 11 percent), TCS (up 9.6 percent), and Bharti Airtel (up 8 percent) since November 26.

Let’s look at the final tally on D-Street – the S&P BSE rose 59 points to 41,932 while the Nifty50 closed with gains of 12 points at 12,355 on Thursday.

Sectorally, the action was seen in Realty, consumer durables, healthcare, and telecom stocks while profit-taking was seen in metal, oil & gas, and public sector. Metal stocks were under pressure after the US-China Phase-1 trade deal.

Broader markets outperformed as the S&P BSE Smallcap, and Midcap indices rose 0.78-0.77 percent respectively. The Nifty Midcap index outperformed Nifty as it closed at a fresh 7-month high of 17,985, said a CNBC-TV18 report.

The Nifty Midcap Index gains for the 8th straight day to post the longest gaining streak in 18 months.

Experts are of the view that action in the small & midcaps are likely to continue thanks to stable global cues, and liquidity. But, earnings and Budget 2020 are likely to dictate the near-term trend for the markets.

“Nifty traded dull and settled almost on the flat note, after oscillating in a range. However, the continued buoyancy in the midcap and smallcap saved the day for the traders,” Ajit Mishra, VP – Research, Religare Broking Ltd told .

“We’re seeing rotational buying on the sectoral front which is helping the index to inch gradually higher. However, the actual gains are in the broader markets where we’ve seen a noticeable recovery in the last two months or so,” he said.

Mishra further added that domestic factors viz. earnings and budget expectations will continue to dictate the market trend in the near future so keep a close eye on announcements for cues.

Top Nifty gainers: Kotak Mahindra Bank, ZEE Entertainment, Nestle India, and Eicher Motors.

Top Nifty losers: JSW Steel, Hindalco, NTPC, and GAIL India.

Stocks & Sectors:

Sectorally, the action was seen in the Realty index which was up 0.97 percent, followed by the S&P BSE Consumer Durables index that rose 0.7 percent, and the Healthcare index was up 0.64 percent.

Profit-taking was seen in the Metal index that was down 1.39 percent, followed by the S&P BSE Oil & Gas index which fell 0.46 percent, and the Public Sector index fell 0.58 percent.

Volume spike of 100-400% was seen in stocks like IDEA Cellular, Page Industries, Muthoot Finance, InterGlobe Aviation, and Nestle India.

Long Buildup – Torrent Pharma, Cadila Healthcare, Torrent Power,

Short Buildup – IndusInd Bank, Ramco Cements, GAIL India, IOC

Stocks in news:

Shares of Mahanagar Gas jumped over 2 percent to hit their fresh 52-week high of Rs 1,148 after brokerage firm Credit Suisse initiated coverage on the stock with an ‘outperform’ view. Credit Suisse has set a target price of Rs 1,280 for the stock and expects further margin expansion in Q1FY21.

Granules India share price touched its 52-week high of Rs 144.90 as the company board will meet on January 21 to consider a proposal for buyback of equity shares.

Camlin Fine Sciences slipped 5 percent after the company received closure notice from Maharashtra Pollution Control Board (MPCB).

Wockhardt share price gained 5 percent after the company received Indian regulatory approval for its two new antibiotics.

Torrent Pharmaceuticals share price touched its 52-week high of Rs 1,967.50 ahead of the board meeting for fundraising. The stock closed with gains of 1.3 percent.

Technical View:

Nifty formed a Doji pattern on the daily charts

The index witnessed profit-taking at higher levels around 12,400

It appears that Nifty is in need of a fresh breakout in either of the directions to add momentum.

However, as our twin momentum oscillators generated a fresh sell signal, experts expect a sideways move with negative bias for the next couple of sessions.

On the downsides, weakness shall get confirmed on a close below 12,278 levels, which can provide a shorting opportunity, whereas a positive move beyond 12389 levels may extend the rally upto 12450 – 490 levels but shall peter out sooner than later, they say.

Three levels: 12278, 12315, 12389

Max Call OI: 12500, 12400

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