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Taking Stock | Sensex, Nifty rise a percent each; investors richer by Rs 2.8 lakh crore –

Indian equities logged healthy gains on May 18 as investor sentiment improved over the decline in India’s COVID-19 cases and positive Asian markets also underpinned the momentum.

The Sensex closed 613 points, or 1.24 percent, higher at 50,193.33. The Nifty ended 185 points, or 1.24 percent, higher at 15,108.10. BSE midcap and smallcap indices closed 1.87 percent and 1.28 percent higher, respectively.

The Sensex opened in the green and remained in the positive territory throughout the session. At close, the 30-share pack had 25 stocks in the green.

The overall market capitalisation of BSE-listed firms jumped to Rs 216.4 lakh crore on May 18 from Rs 213.6 lakh crore the previous day, making investors richer by Rs 2.8 lakh crore in a day.

“The Nifty has finally regained momentum after spending nearly two months in a consolidation range and reclaimed the 15,000-mark. The rise can be attributed to a decline in India’s COVID cases and stability in the global markets,” said Ajit Mishra, VP – Research, Religare Broking.

Among the sectoral indices, banking and auto have witnessed decent traction in the last two sessions after underperforming for nearly a month or two, he said.

“Indications are in the favor of prevailing up move to continue thus we suggest continuing with the buy on dips approach,” Mishra said.

market snapshot 1805

Sectors and stocks

Among the sectors, BSE auto rose 3.19 percent, while capital goods, consumer durables, power, industrials, consumer discretionary rose more than 2 percent each.

BSE telecom fell 1.66 percent and FMCG index closed 0.37 percent lower.

More than 310 stocks, including Bajaj Finserv, Power Grid, Adani Enterprises, Bharat Forge and Cyient, hit their 52-week highs on BSE.

More than 430 stocks, including GATI, Neuland Laboratories, Reliance Power, Adani Power and Trident, hit their upper circuits on BSE.

Technical view

The short-term technical condition of the market shows that the expected range of the market is likely to be 14,900-15,400.

“The market breadth will improve further as the market crossed the critical resistance around 14,950. In the short term, 15,100-15,150 is likely to act as a temporary supply zone. Once this level is overcome, the market is expected to gain momentum, leading to an upside projection till the 15,400 level,” said Ashis Biswas, Head of Technical Research at CapitalVia Global Research.

Mazhar Mohammad, Chief Strategist – Technical Research & Trading Advisory, said though the Nifty appears to have registered a breakout with a gap-up opening above its 50-day old descending channel, the intraday trading range remained narrow with 94 points resulting in a small bullish candle, which can be a cause for concern.

“Going forward, it needs to sustain above today’s bullish gap area present in the zone of 15,043–14,938 levels. If this gap zone successfully offers support on dips then, in course of time, bulls can head higher to test their lifetime highs present around 15,431 levels,” he said.

If the Nifty fails to sustain above 15,043, it can attract some intraday selling pressure and such weakness can be an opportunity to create fresh longs. Therefore, traders should buy the weakness close to 15,000 with a stop below 14,938 on a closing basis.”

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