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Taking Stock | Market ends flat a day ahead of ECB meet; banking heavyweights cap the fall –

Market benchmarks the Sensex and the Nifty settled flat on September 8 tracking weak global cues as investors turned cautious a day ahead of a European Central Bank (ECB) meeting which is expected to keep discussion over stimulus in focus.

The Sensex opened higher but remained on a bumpy track throught the session, swinging nearly 450 points during the session.

Sensex closed 29 points, or 0.05 percent, down at 58,250.26 while the Nifty settled 9 points, or 0.05 percent, lower at 17,353.50.

The fall in Sensex was capped by gains in private bank heavyweights such as Kotak Mahindra Bank, HDFC Bank, ICICI Bank and Axis Bank.

Mid and smallcaps outperformed the frontline stocks as the BSE Midcap index clocked a gain of 0.81 percent while the smallcap index settled 0.55 percent higher.

“In a volatile session of trade today, the bulls managed to stage a smart comeback led by the pace of vaccinations and accumulation witnessed in Kotak Mahindra Bank,” S Ranganathan, Head of Research at LKP securities, observed.

“The broader markets witnessed interest in textile stocks on the back of the PLI scheme announced today. The late afternoon session saw advances gain ground over declines as several midcaps were seen buzzing,” he said.

Sectors and stocks

Among the sectors, Nifty Bank, private bank, PSU bank and financial services indices rose up to a percent. On the flip side, IT, media, auto and pharma indices ended in the red.

Nearly 200 stocks, including Bharti Airtel, Nestle India, UltraTech Cement, Ambuja Cements, APL Apollo Tubes, Bajaj Electricals, Blue Dart Express, Deepak Nitrite, Can Fin Homes, Oil India, Pfizer and United Breweries, hit their fresh 52-week highs in intraday trade on BSE.

On the other hand, more than 350 stocks, including Nelco, Jain Irrigation Systems, Trident, Shemaroo Entertainment, Brooks Laboratories, SORIL Infra Resources, Laxmi Organic Industries, Zen Technologies, Shreyas Shipping & Logistics and Artemis Medicare Services, hit their upper circuits in intraday trade on BSE.

Technical view

Technical setup is showing that the market is finding strong resistance around 17,500. If the market breaches this level, a move towards 18,000 will be the next target.

Rohit Singre, Senior Technical Analyst at LKP Securities, pointed out that Nifty is unable to cross above its immediate swing high which is around 17,440, so it will act as immediate and strong resistance, followed by 17,500.

“Any break above the mentioned resistance may result in good traction and can make the index inch towards 18,000 mark. Immediate support is still placed at the 17,300-17,250 zone and traders can use it as their trailing stop-out levels,” said Singre.

Outlook for September 9

Chandan Taparia, Vice President and Derivatives Analyst, Motilal Oswal Financial Services

Nifty breached its previous day’s low but buying interest at declines made it to close above 17,350. It formed a hammer sort of candle on daily scale with long lower shadow, indicating buying interest is intact at any declines.

Now, it has to continue to hold above 17,300 to extend the move towards 17,500 and 17,777 while on the downside, support is seen at 17,200 and 17,050 levels.

Ashis Biswas, Head of Technical Research at CapitalVia Global Research

The market witnessed a small correction and a reversal from the support at 17,250. The market suggests that 17,200-17,250 will be an important support zone to stay positive in the short term.

If the market is able to sustain the level of 17,200-17,250, it can witness higher levels of 17,500. Technical indicators suggests a volatile movement in the market in a small range between 17,200-17,500.

Palak Kothari, Research Associate, Choice Broking

Nifty continues to trade in lower lows formation from the last three trading sessions, but in the hourly chart, the index has taken support from 50-HMA and bounced from there, which points out strength in the counter.

On a four-hourly chart, the index has formed a hammer candlestick pattern which points out buyers are active.

All the key indicators like RSI, MACD & Stochastic are supporting the positive trend in the index. At present, the psychological level of 17,500 could be a resistance while on the downside, 17,200 may act as support for the index.

Ajit Mishra, VP – Research, Religare Broking

We expect choppiness to continue in the index on September 9 as well due to the scheduled weekly expiry. Nifty has been hovering within the range of 17,250-17,400 and an either side breakout would trigger the next directional move. Apart from the global markets, traders should keep a close watch on the banking pack.

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