D-Street ends in red for third day running; Nifty holds 15,600 support, will bulls make a comeback?

Bears continue to control benchmark indices, forcing Sensex and Nifty lower for the third consecutive day amid a global market sell-off. S&P BSE Sensex recouped some intra-day losses but closed 0.68% lower at 52,198, while the NSE Nifty 50 index ended 0.76% lower at 15,632. Nine of the thirty Sensex constituents closed in the green while others were deep in the red. Asian Paints jumped 6% to close as the top Sensex gainer, followed by Ultratech Cement, Bajaj Auto, HUL, Nestle India, Maruti, TCS, Infosys, and Bajaj Finserv. IndusInd Bank fell 3.32%, followed by Tata Steel, NTPC, and Bharti Airtel. Bank Nifty was down 1.89% while midcap and smallcap indices tanked more than 1.5% each. 

Deepak Jasani, Head of Retail Research, HDFC Securities –

“Indian markets fell for the third consecutive session on July 20. Patchy Monsoon Rain in India and subdued Q1FY22 corporate results raised fresh concerns on the economic growth and market valuation. European stocks however rose on Tuesday, setting a partial recovery after the worst session in the year amid worries about the lingering COVID-19 pandemic. Nifty could remain in the 15520-15690 band for the next 1-2 sessions. After the three day fall, a small bounce is likely which may not sustain for long.”

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

“The markets have been able to close above the 15600 support which is heartening for the time being. The short term trend gets threatened if we break this level on a closing basis. If a reversal in trend happens from the current juncture, the Nifty can scale up to 16000-16100. It is better to wait for a clean direction to emerge as the current risk to reward ratio is skewed in favor of the risk.”

Vinod Nair, Head of Research at Geojit Financial Services –

“Bears dominated D-street following overnight selling in global markets due to spread of the highly contagious Delta variant and fall in economic growth data. Sharp fall in crude price & US bond yields reflected the rising concern over fall in future growth. Vulnerability from premium valuations, upcoming FOMC meeting and selling by foreign investors exposed the Indian market. However, western markets attempted to recover from the sell-off which provided some comfort to the domestic market in between but selling continued.”

Sumeet Bagadia, Executive Director, Choice Broking –

“On the technical front, the Nifty 50 index has fallen more than 2% in the last two days and also closed a day below the prior Doji Candlestick. A momentum indicator RSI & Stochastic showed negative crossover. However, the index has taken good support at 50-days SMA and pulled back from there, which indicates some recovery for the coming session. At present, the nifty has support at 15500 levels while resistance comes at 15830 levels.”

Rohit Singre, Senior Technical Analyst at LKP Securities –

“One more negative session with index closed a day at 15632 with loss of nearly one percent and formed a bearish candle on the daily chart for the second consecutive session.  The last two sessions wiped out full gains of last week also index has invalidated the ascending triangle structure, only positive sign is index managed to hold above the 15600 zone which hints if current levels are held then we may see some pullback in the upcoming session towards immediate hurdle zone of 15700-15770 zone and supports are still placed at 15600-15530 odd levels.”

Gaurav Udani, CEO & Founder, ThincRedBlu securities –

“Nifty declined on the 2nd consecutive day today. It ended about 125 points negative. Nifty also broke its important support of 15600 on intraday basis and managed to close marginally above it at 15625. Now a further fall below 15600 can take nifty to 15400 levels.  Traders are advised to be cautious in their long positions and a tight stop loss should be maintained to protect capital.”