Investors book profit above 10,100, Sensex below 34k-mark

Indian market witnessed profit booking with  both Sensex and Nifty closing in the red on June 4. The S&P BSE Sensex failed to hold on to 34,000 while the Nifty50 witnessed profit taking above 10,100 for the second day in a row.

Let’s look at the final tally on D-Street – the S&P BSE Sensex fell 128 points to 33,980 while the Nifty50 was down 32 points to 10,029.

Sectorally, the action was seen in energy, IT, healthcare, metals, and auto stocks while profit-taking was visible in banks, finance, capital goods, and realty.

On the broader markets front – the S&P BSE Midcap index closed 0.06 lower while the S&P BSE Smallcap index fell 0.05 percent.

Top Nifty gainers include names like Cipla, Sun Pharma, Tech Mahindra, ZEE Entertainment, and Vedanta

Top Nifty losers include names like Kotak Bank, IndusInd Bank, Bajaj Finance, HDFC, and Asian Paints.

What should investors do?

The Nifty50 closed in the red after 6 straight sessions of rise, but it managed to close above its crucial support of 10,000 for the second day in a row. The index formed a ‘Doji’ kind of pattern on daily charts on Thursday.

However, the journey is unlikely to be smooth as we attempt to move beyond 10,100, suggest experts. The good part is that we have recovered more than 50 percent of the entire fall seen in benchmark indices.

Given the fact that the market has rallied about 1000 points in a hurry, some consolidation cannot be ruled out, suggest experts. The likely range in which Nifty50 is likely to move would be 9700-10,170. A close above 10,170 could open room for 10,600 levels.

“If we consider that our markets would try to follow US markets further, then we may see the levels of 10600 on Nifty and 36000 on the Sensex. Coincidently, the level of 10600 was earlier major support for the market in the year 2019,” Shrikant Chouhan, Executive Vice President, Equity Technical Research at Kotak Securities told .

“The Nifty may consolidate between 10170 and 9700, before hitting the levels of 10600. The markets have already run-up a lot, Time based and price based correction is a must in the short term to adjust the prices,” he said.

Chauhan further added that for the next few days or weeks 9900 and 9700 would be major supports. On the higher side, 10300 and 10600 would be hurdles.

Stocks & Sectors:

Sectorally, the action was seen in the S&P BSE Telecom index which was up 3.4 percent, followed by the S&P BSE IT index which gained 1.8 percent, and the S&P BSE Energy index was up 1.8 percent.

Profit-taking was seen in the S&P BSE Bankex which fell 2.7 percent, followed by the S&P BSE Finance index which was down 2.5 percent, and the S&P BSE Realty index was down 1.6 percent.

Volume spike of more than 100% was seen in stocks like Biocon, Sun Pharma, Cipla, Aurobindo Pharma, and Idea Cellular.

Long buildup was seen in stocks like Tata Power, Amara Raja Batteries, Canara Bank, and Idea Cellular

Short Buildup was seen in stocks like Bata India, Ashok Leyland, Chola Finance, and LIC Housing Finance.

More than 50 stocks hit a fresh 52-week high that includes names like Aarti Drugs, Aurobindo Pharma, Cipla, KIFS Financial, etc. among others.

Stocks in the news:

The banking index which had driven the gains for the last few days was incidentally the biggest loser in today’s trade. The NiftyBank closed 2.6 percent lower, weighed down by losses in Bandhan Bank, IndusInd Bank, Kotak Bank, Axis Bank, ICICI Bank, HDFC Bank, and SBI.

Bharti Airtel up 4% on Reuters’ report of Amazon looking to buy $ 2 bn stake

Multiplex stocks close with health gains; PVR & Inox Leisure up 7-16%

Airline stocks were in focus with SpiceJet & Indigo gaining 5% & 9% respectively

HDFC Life: CMP: Rs 517.70 | Stock price was up 3 percent after after Housing Development Finance Corporation (HDFC) offloaded 1.28 percent equity stake in its subsidiary.

Shree Renuka Sugars | CMP: Rs 6 | Stock price gained over 4 percent after the board approved the proposal for raising funds.

Cholamandalam Investment | CMP: Rs 142.95 | The stock price fell over 8 percent after net profit slumped 85.38 percent to Rs 42.66 crore for the quarter ended March 31.

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