Equity markets opened gap up and continued its strong momentum throughout the session amidst monthly F&O expiry and positive global cues. Nifty rose 115 points (+0.8%) to close at 15,097, while Sensex ended 258 points higher (+0.5%) at 51,039. The broader market too gained with Nifty Midcap 100/ Nifty Smallcap 100 up +1.5%/+1.4%. Except Financials (-0.2%) and FMCG (-0.3%), all other sectors ended in green with Metals being the biggest gainer - up +4.0%, followed by Energy (+3.1%). PSU Banks, Infra, Realty and Media gained more than 1% each while rest gained less than 1%.
Global cues turned positive after US Federal Reserve Chair Jerome Powell said policy rates could remain low for years, calming inflation concerns. On the domestic side, Nifty posted strong gains to reclaim 15k mark - a day after the bourses had to extend trading hours to help investors square off positions, following the longest-ever outage at the NSE. The disruption led to a 141% jump in total options volume on expiry day and was double the average jump in volumes seen on expiry day in the last four months. On the macroeconomic front, Moody's raised its growth projections for India, saying the economy is expected to clock a growth of 13.7% in FY22 on the back of the normalisation of activity and rollout of COVID-19 vaccines.
Commenting on the market outlook, Siddhartha Khemka, Head - Retail Research, Motilal Oswal Financial Services said, "Technically, Nifty formed a small Bodied candle on daily scale with long upper shadow which indicates that follow up is required to attempt the life time highs. It continues its formation of higher highs - higher lows of the last two trading sessions. Now, it has to continue to hold above 15,000 to extend its move towards 15,250-15,400 zones while on the downside immediate support exists at 14,900-14,850 levels. India VIX fell down by 5.3% from 24.16 to 22.89. VIX needs to cool down below 21-20 zones to extend this bounce towards new high territory."
"Going ahead, the market may continue with its positive momentum given strong global cues. Investors would also track US GDP data on Friday for further direction. However given high valuations and volatility in the market, traders should trade cautiously with stock specific action and book profits in regular intervals," he added.
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