Sensex, Nifty snap five-day falling streak; will bulls return to Dalal Street now?

Domestic stock markets returned to positive territory on Tuesday, ending the 5-day losing streak. S&P BSE Sensex gained marginally to end at 49,751 while Nifty 50 regained 14,700. Broader markets outperformed benchmark indices. BSE Smallcap index was up 0.74%, BSE Midcap index gained nearly 1%. ONGC was the top gainer, zooming 5.55% at the end of the day’s trade. Kotak Mahindra Bank was the top laggard, falling 3.87%. The volatility index fell 0.95% after having zoomed more than 15% yesterday. Among sectoral indices Bank Nifty, Nifty PSU Bank, NIFTY Private Bank, and Nifty Pharma closed with losses.

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

“Markets logged small gains after a sharp decline in last five sessions. Most of the time such type of formation works as a continuation and on Wednesday, if the market breaks the 14630/49600 level, the Nifty / Sensex could fall further on the support of 14530/49300 levels. However, a 50% retracement shown by the Nifty / Sensex after the announcement of the Union Budget could be a reversal for the market. In short, there should be a buying strategy if the Nifty / Sensex falls to the 14530/14500 levels, however, if the Nifty closes below the 14500 level, it would indicate further weakness. On the upside, 14850/50350 and 14950/50750 levels would be the major obstacles.”

Deepak Jasani, Head of Retail Research, HDFC Securities –

“Indian benchmark equity indices closed off the highest point of the day on Feb 23 but managed to snap a five-day losing streak. Asian markets mostly rose Tuesday, powered by growing hope that vaccine rollouts will allow the global economy to get back on track, but the optimism was moderated by niggling worries that the recovery will fan inflation and interest rate hikes. Emerging market bond funds faced outflows for the first time in 21 weeks in the week ended Feb. 17, with outflows of $689 million.”

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

“The Nifty gave up most of its gains as the day progressed. The weakness continues to remain in the short term and we can expect the index to slide further to levels closer to 14500. Any rally up can be used to short this market for lower targets. The upside is capped at 15000 -15100 and until we do not get past that comfortably, the markets will remain bearish.”

Vinod Nair, Head of Research at Geojit Financial Services –

“Domestic market got back on its feet during the morning trade supported by strong Asian market while negative waves from European peers outweighed the gains by the end of the day. The expectation of strong global recovery as prompted by rising international commodity prices helped the market but was tempered due to elevated bond yield & virus cases. Consequently, volatility has increased in the domestic front, but broad markets continue to be attracted with themes like Mid & Small caps, cyclicals, energy, PSUs, Metals and Industries.”

Rohit Singre, Senior Technical Analyst at LKP Securities –

“Index managed to hold above 14700 zone and closed a day with small gains forming a Doji candle pattern on the daily chart after consecutive five bearish candle. The index has good support near 14630 zone and immediate resistance is coming near 14800 zone so index may show some sort of consolidation in the same range and final direction will be clear once we see either side breakout from the mentioned range.”