Nifty and Bank Nifty Closes Strong, Breaks Recent Downtrend Channel - Post Market Analysis


NIFTY opened the day flat at 16,475 and took support at 16,440. Then the index was in a clear uptrend and hit a day high above 16,650. NIFTY has broken a downtrend channel and closed the day at 16,641, up by 157 points or 0.96%. 

BANK NIFTY started the day at 36,370 and moved more than 1.5% to the day high. The index also took support from a channel and now it was broken in the second half.  Bank Nifty ended the day at 36,783, up by 375 points or 1%.

All the indices closed in the green today. Nifty Bank (+1%), Nifty IT (+1.6%), Nifty Media (+2.1%), Nifty Pharma (+2.3%) and Nifty PSU Bank (+2%) gained well.

Major Asian markets closed mixed. European markets are trading flat to green currently.

Today’s Moves

Pharma stocks saw buying again ahead of results this week. SunPharma (+3%) closed as the Nifty 50 Top Gainer. 

Alkem (+1.9%), Auro Pharma (+3%), Biocon (+1.5%), Cipla (+1.9%), Divis Lab (+2.7%), Dr Reddy (+1.7%), Glenmark (+4%) moved up.

Laurus Labs (+6.1%) shot up as Q1 profit was announced in line with estimates.

Bharti Airtel  (-1.3%) and Reliance (-0.09%) traded weak- 5G Auction effects.

Rotational buying is seen in cement stocks including Ultra Tech Cements (+2.1%), Grasim (+2.1%), ITD Cementation (+2.7%), Ramco Cements (+3.7%), JK Cement (+1.3%), and Shree Cements (1.8%). They are expecting good demand in the coming months.

LT (+2.5%) and Asian Paints (+2.4%) also featured in the Top Gainer list after posting Q1 results yesterday. 

But McDowell (-6.7%) and Tata Power (-3.6%) ended in the Fno Top Loser list post Q1 results. UBL (-1.8%) also moved down.

After the recent rally in NBFC stocks, M&M Fin (-3.6%), and SR TransFin (-1.8%) saw profit booking.

Bajaj Finance (+2.1%) posted a 160% YoY growth in Q1 net profit to Rs 2600 crore.

PVR (+3.5%) hit a 52-week high after announcing its latest innovation in cinema advertising.

Maruti Suzuki (+1.5%) posted a weaker than estimated Q1 net profit at Rs 1010 crore.

Colpal (+1.9%) saw buying after Q1 standalone net profit was reported at Rs 210 crore against the estimate of Rs 240 crore.

Google Maps has decided to launch the street view feature in India in partnership with Genesys (+5%-UC) and Tech Mahindra (+0.83%).

Markets Ahead

Nifty and Bank Nifty broke out of the recent downtrend channel in the 1-hour candle chart. And the breakout is good enough for a decent upside move.

Nifty has closed above 16,600 and it shows strength in the market. But we should be more concerned about US updates than the 16,700 resistance.

Bank Nifty is trading near a long-term resistance trendline. 37k, 37,300 and 37,600 are the resistance levels on the watchlist.

Kotak Bank is trying to recover from the recent fall and could be watched. HDFC Bank once again closed above 1400, but we need to watch the 1420 level for more clarity.

US interest rate decision will be out tonight and we have monthly expiry tomorrow. We can expect some good movies in the second half.

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