Nifty snaps 4-day losing streak; 12,200 crucial for bulls

The Nifty50 snapped its 4-day losing streak and closed in the positive territory on January 23 on the back of stable earnings from L&T, Axis Bank and crude prices hitting a 7-week low. However, muted global cues capped the upside.

The S&P BSE Sensex rallied nearly 300 points while the Nifty50 closed near its intraday high of 12,189.

Let’s look at the final tally on D-Street – the S&P BSE Sensex rose 271 points to 41,386 while Nifty50 closed with gains of 73 points to 12,180.

On the sectoral front, action was seen in the capital goods space, followed by realty, oil & gas, infrastructure, and telecom stocks. All sectors ended the session in the green. Nifty Bank advances 303 points with all its constituents in the green.

The broader market outperformed frontlines. S&P BSE Midcap index rose 1.06 percent while the S&P BSE Smallcap index was up 0.95 percent.

Market recouped losses but for bulls to regain control on D-Street a close above 12,220-12,250 is required on the Nifty50, suggest experts.

“The markets managed to gain over half a percent amid volatility as buying in the select index majors not only capped downside but also triggered a sharp rebound as the session progressed. Favourable earnings announcements combined with oversold positions triggered rebound,” Ajit Mishra, VP – Research, Religare Broking Ltd told .

“The earnings disappointment mainly from the banking majors has dragged the markets lower and it may take some time to subside. In case of a rebound, Nifty would find hurdle around 12,200-12,250 zone. We advise focusing more on stock selection and positioning trades on both sides,” he said.

Top Nifty gainers: BPCL, GAIL India, IOC, and YES Bank

Top Nifty losers: Tech Mahindra, Cipla, UPL, and ZEE Entertainment

Stocks & Sectors:

Sectorally, the action was prominent in the S&P BSE Capital Goods index which was up 2.3 percent, followed by Realty index which gained 2.04 percent, and the S&P Oil & Gas index closed with gains of 1.83 percent.

Volume spike of 100-600% was seen in L&T, Cummins India, Canara Bank, IGL, MRF, and PVR.

Long Buildup – IOC, PFC, Coal India, ONGC, Adani Power

Short Buildup – Power Grid, NMDC, UPL, Cipla, CESC

More than 80 stocks hit a fresh 52-week high. These include Nestle India, Apollo Hospitals, Jubilant FoodWorks, Amber Enterprises, Ipca Laboratories, etc. among others.

Stocks in news:

GE T&D: GE T&D was up over 6 percent after the company bagged a project from Jammu & Kashmir Power Development Department for the distribution operations in the cities of Jammu and Srinagar.

YES Bank: Share price of YES Bank jumped over 6 percent after State Bank of India Chairman Rajnish Kumar indicated that the private lender will not be allowed to fail.

IOC: Indian Oil Corporation (IOC) share price ended with over 4 percent gains after signing Memorandum of Understanding (MoU) with Ghana’s oil regulator – National Petroleum Authority.

Granules India: Shares of Granules India climbed over 7 percent to hit a fresh 52-week high of Rs 161 after it extended gains into the second consecutive session post Q3 results.

L&T: Share price of Larsen & Toubro gained nearly 3 percent after the company reported profit growth of 15.15 percent year-on-year (YoY) to Rs 2,352 crore in the quarter ended December 2019, driven by lower tax cost (down 37 percent YoY) and operating income.

Technical View:

Nifty formed a bullish candle as it took support near the 50-EMA placed at 12,080.

However, for bulls to regain control, a close above 12,225 levels is required, suggest experts. This can take the index towards 12298-12361 levels., they said.

A close below 12,087 can resume the weakness in the index with targets placed around 11,900 levels.

Three levels: 12094, 12189, 12225.Get access to India’s fastest growing financial subscriptions service Pro for as little as Rs 599 for first year. Use the code “GETPRO”. Pro offers you all the information you need for wealth creation including actionable investment ideas, independent research and insights & analysis For more information, check out the website or mobile app.