Border tension, rise in COVID cases cap upside; Nifty closes above 11,350

Indian markets snapped two-day losing run on September 7 to close the green, with the Nifty50 reclaiming the crucial 1,1350 level towards the close, which is a positive sign for the bulls.

The S&P BSE Sensex rose 60 points to close at 38,417 while the Nifty50 gained 21 points to end at 11,355. Trading was subdued as the US market is closed for Labour Day.

The Nifty witnessed profit-taking at higher levels near 11,400 but found support near 11,250.

The border tension with China and spiralling coronavirus infections that put India ahead of Brazil to have the second-highest case count in the world of more than 40 lakh capped the upside for markets.

“Indian markets traded with volatility and finally ended the day with a positive bias. Virus infections continued to rise unabated and this fear combined with a sell-off seen in the US markets, in the previous trading session, served to bring in doubts regarding the continuation of the momentum seen in recent times in the market,” Vinod Nair, Head of Research at Geojit Financial Services told .

“Investors would do well to stay nimble, watch global sentiments and trade cautiously” he said.

Sectorally, action was seen in IT, metals, consumer durables, and pharma stocks while profit-taking was seen in realty, utilities, and oil and gas stocks.

The broader markets underperformed the benchmarks. The S&P BSE midcap index fell 0.78 percent and the S&P BSE smallcap index closed 0.2 percent lower.

Top Nifty gainer included Dr Reddy’s Laboratories, HDFC Life Insurance Company and Bharti Infratel.

Top Nifty losers included Bajaj Finance, UPL, and M&M.

Stocks & Sectors

In terms of sectors, action was seen in the S&P BSE IT index which was up 0.8 percent followed by the FMCG index that rose 0.7 percent and metal index closed with gains of 0.2 percent.

Some profit-taking was seen in the S&P BSE realty index that fell 0.8 percent followed by the utilities that was down 0.7 percent and the oil & gas index closed with losses of 0.5 percent.

A volume spike was seen in Escorts, ACC, Havells India, and HUL.

Long buildup was seen in stocks like Ramco Cement, Asia Paints, and Tata Consumer.

Short buildup was seen in stocks like Balkrishna Industries, Hero MotoCorp, and Godrej Consumer Products.

More than 100 stocks hit their fresh 52-week high on the BSE that include Dixon Tech, Wabco India, AstraZeneca, and IndiaMart and InterMESH.

Technical View

The Nifty formed a Doji pattern on the daily charts.

The index failed to hold above the 11,350-11,370 zone and drifted towards 11,250 in the first hour of the session

The Nifty had a roller coaster ride as swung from positive to negative for the most part of the session.

It formed a Dragon Fly Doji with a long lower shadow, which indicates that declines are being bought.

The Nifty has again got stuck in a broader range and has to hold above the 11,450-11,500 zone to get the bullish stance for a move towards the 11,750-11,800 zone.

On the downside, immediate support exists at 11,250-11,200 zones, Chandan Taparia, Motilal Oswal Financial Services Limited told .