The market had a strong start for Samvat 2078 as the benchmark indices gained half a percent on November 4, the Diwali Muhurat Trading Day 2021, driven by buying across sectors (barring metals). Even the broader markets participated in the run with fall in volatility.
At close, the BSE Sensex stood above 60,000 mark, rising 295.70 points to 60,067.62, while the Nifty50 jumped 87.60 points to 17,916.80 and formed small bearish candle on the daily charts as the closing levels are lower than opening.
On the Diwali Laxmi Pujan day, investors turned richer by Rs 1.93 lakh crore as the BSE market capitalisation increased to Rs 265 lakh crore on Thursday, up from Rs 263.07 lakh crore in the previous session.
Experts feel the upward momentum is likely to continue in the Samvat 2078 as well, but the pace of rally may not be similar to Samvat 2077 due to expected inflation concerns and Fed tapering. BSE Sensex had gained 36 percent and the Nifty50 surged 40 percent in Samvat 2077.
“After a great year for equity markets, investors are looking forward to markets continue rising though not at the same pace. Global headwinds in the form of rising inflation and withdrawal of monetary stimulus may impact the momentum, but strength in Indian macros and improving micros may help offset these,” said Dhiraj Relli, MD & CEO at HDFC Securities.
Investors need to conduct portfolio review, asset allocation review, and raise the quality of stocks held in their portfolio, Relli advised on muhurat trading day.
Mahindra & Mahindra and ITC were leaders in the BSE Sensex, gaining 3.1 percent and 2.1 percent, respectively. Bajaj Auto, L&T, Kotak Mahindra Bank, Nestle India and Sun Pharma gained 1-1.65 percent.
However, ICICI Bank, Asian Paints, UltraTech Cement and Dr Reddy’s Labs were only losers, closing with moderate losses.
Among sectors, FMCG, Industrials, Auto and Capital Goods were top gainers, rising more than 1 percent each.
The broader markets outpaced frontline indices. The BSE Midcap index jumped 0.81 percent and Smallcap index gained 1.5 percent.
Top gainers in the futures & options segment were Indian Hotels, Eicher Motors, City Union Bank, Delta Corp and Mahindra & Mahindra, rising 3-6 percent. However, Gujarat State Petronet, Hindalco Industries, Chambal Fertilizers, ICICI Bank and Metropolis Healthcare.
The Nifty50 formed bearish candle which resembles a bit of Doji kind of pattern formation on the daily charts, indicating some indecisiveness among the bulls and the bears.
“We continue to remain cautious on the market because of few technical developments, they are as follows: 1) the ‘Lower Top Lower Bottom’ on daily chart got confirmed last Friday after breaking below 18,000, 2) this coincided with the violation of the key short term moving average of ’20-day EMA’, which is now acting as a sturdy wall, and 3) more importantly, if we take a glance at the monthly chart, we can see a formation of ‘Shooting Star’ pattern, which certainly does not bode well for the bulls,” said Sameet Chavan, Chief Analyst-Technical and Derivatives at Angel One.
He advised traders not to carry aggressively bets on the long side as long as the index remains below 18,000 – 18,100 on a closing basis.
“On the flipside, we may see this corrective move extending towards 17,450 first and if things worsened then the possibility of sliding towards 17,200 – 17,000 cannot be ruled out. The coming week would be quite crucial for the market as it may dictate the near term direction,” Chavan said.
Bank Nifty also formed bearish candle on the daily charts as the closing was lower than opening levels. The index was up 171.65 points at 39,573.70.