Indian equity benchmarks closed the third consecutive session on a flat note after witnessing a consolidation throughout the session. Indices were completely directionless on Thursday, could be awaiting some triggers like earnings season, change in government policies etc.
According to Dipan Mehta, Member BSE and NSE, the best strategy would be to wait and watch, and may be at higher levels if crude persistently remains at these levels and government policies is not forthcoming then one should look at booking profits and hope for a correction to then get into the stocks markets. "I think it’s a bit of a status quo at this point of time and it is very difficult to call which way the market could move from these levels."
Even the global markets were flat in trade - could be awaiting interest rate decision in the ECB meet. Analysts were expecting about 25 basis points hike in rates today.
Indices consolidated but have not seen any profit booking yet - especially after more than 1800 points rally in previous two weeks. This rally was supported by foreign money, who have bought more than USD 2 billion worth of equities.
The 50-share NSE Nifty has been stuck in a 50 points zone for the last three sessions, says Devangshu Datta, Consulting Editor, Outlook - the range was 5860-5810.
The Nifty fell 6.05 points, to close at 5,885.70 - below 5900 for the second straight day and the 30-share BSE Sensex declined 21.02 points, to settle at 19,591.18.
"For the next two-three sessions we will have 150 points move but it could be in either direction. It could drop back to 5,750, it could go up to 6,050 but this sort of very narrow trading doesn’t usually last for more than three-four sessions," Datta said.
Market is purely moving on technicals, says Piyush Garg, CIO of ICICI Securities. 5"950 is a very strong resistance and unless we can take that out on a closing basis, at least two consecutive days, market may tend to basically halt here. Otherwise, we are in sync with global markets."
HDFC was the top gainer, with rising 2.4%. Wipro, Bharti, SBI, L&T, ICICI Bank, Tata Steel and Hero Honda were the leading gainers, with gaining 0.4-1.4%.
However, ONGC, NTPC, TCS and Sesa Goa were top losers, with falling 2-3%. HDFC Bank, Reliance Industries, Sterlite, Maruti and Tata Motors were other losers.
Midcaps and smallcaps were star performers ahead of earnings and there has been rotation of sector. The broader indices hogged the limelight and outperformed the benchmarks.
In fact the BSE Midcap Index has been rallied for the 13th consecutive session today, with gaining 780 points. It closed at 7,264.29, up 70.42 points. The BSE Smallcap Index rallied more than 900 points in last seven sessions; it gained 110 points, to close at 8,897.19.
"In midcaps may be little bit more for them to rally," says Dipan Mehta.
Sanjay Dutt of Quantum Securities, "We are already seeing for the last few days that the catch up act has begun in some of the good quality midcap companies across sectors, which were down 30-50% over the last six months, and that action would continue, so the rotation would continue."
In midcap space, Blue Dart was locked at 20% upper circuit. Prestige Estate, IVRCL Assets, Chambal Fertiliser and HT Media were up 7-10%. However, KGN Industries, Wockhardt, A2Z Maintenance, OnMobile Global and Cox & Kings fell 3-5%.
In smallcap space, Zandu Realty and Minda Industries too were locked at 20% upper circuit. Goodyear, Oriental Hotels and Nucleus Software gained 14-15%. However, Hinduja Foundries, Polyplex Corp, R M Mohite, Henkel India and Shri Ganesh lost 5-6%.
About 1964 shares advanced as against 1035 shares declined on the Bombay Stock Exchange.
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