Nifty logs another record closing high despite Nifty Bank index taking a pause

Indian markets closed flat today, recovering from intra-day losses. The Nifty ended 0.04% higher at 13,113, a record closing high, while the benchmark Sensex was down 0.08% at 44,618. Hopes for a COVID-19 vaccine and an eventual economic recovery helped support equities.

Britain became the first country in the world to approve the Pfizer-BioNTech COVID-19 vaccine for use, saying it would start rolling it out early next week.

A 3.8% jump in Asian Paints and gains in automakers and IT heavyweights helped the Nifty close in the green.

“Nifty refuses to settle lower and keeps recovering from intraday losses. At the same time it is becoming difficult for it to rise sharply from hereon. Nifty is not far from the recent high of 13146. Sector and stock rotation could continue till a major trigger takes it either way,” said Deepak Jasani, Head of Retail Research, HDFC Securities.

But losses in top private-sector lender HDFC Bank Ltd and Kotak Mahindra Bank Ltd of 1.8% and 3.3%, respectively, limited gains in the Nifty. The Nifty Banking Index, which surged nearly 24% in November, closed 1.2% lower.

Also read: India can’t make up its mind on PSUs, 30 years after liberalisation

Here is what analysts said on today’s market performance:

Vinod Nair, Head of Research at Geojit Financial services

“After the bull run, banking stocks are taking a halt, in anticipation of the Supreme Court hearing on moratorium. The sector can reverse, as implication of moratorium is well factored and RBI is expected to maintain its accommodative stance with no change in rate given heightened inflation in consecutive months. Positively, more liquidity measures can be released, given weak economic outlook and to support the banking sector. Globally, the market is maintaining its gains, due to talks of stimulus and vaccination in the US and Europe.”



Shrikant Chouhan, Executive Vice President, Equity Technical Research at Kotak Securities

“Nifty has formed one more bullish continuation formation on a daily chart. Despite weakness in the world markets and fall in US stock futures, the market has rejected to fall below the level of 13,000. However, the upside seems limited to 13,250/13,350 levels. Today, Nifty has also shifted its base to 12980 from 12790 levels. The strategy should be to trade long in the market with a stop loss at 12980 on the downside.”

Ajit Mishra, VP – Research, Religare Broking Ltd

“We’re seeing consolidation in the index but the bias is still on the positive side. Going ahead, further updates on COVID vaccines and cues from the global markets will remain in focus. Besides, on the domestic front, RBI’s monetary policy meet would also be on investors’ radar. The MPC is likely to maintain the status quo however their commentary on growth and inflation would be critical.”

Manish Hathiramani, Proprietary Index Trader and Technical Analyst, Deen Dayal Investments

“13050 is the resistance for the Nifty – we need to keep above this level to continue the upward journey. If we can get past 13050, we should achieve 13200. The support is at 12800 and till this level holds, we can continue buying on dips for higher targets.”

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