Bulls to bounce back today

After a profit booking on Monday, the bulls are likely to bounce back on Tuesday, as the SGX Nifty is trading in the positive terrain in early trades and it was up by 27 points at 12,097 levels. The index has been trading in a broad range of 11,800-12,158 for the about last 32 trading sessions and it needs to break out on either side for a directional move. For the day, 12,000 is an immediate important support and in case we breach this support level, the Nifty may touch lower end of the range.

On the Asian side, majority of the markets were trading in green following the positive cues overnight from Wall Street. Hong Kong’s Hang Seng has gained 0.39 per cent and Japan’s Nikkei 225 has risen 0.30 per cent while China’s Shanghai Composite was trading flat.  

Back home, on Monday, the markets snapped its three day winning streak amid profit taking at higher levels. The Nifty shed 0.27 per cent to settle at 12,054 and the BSE Sensex lost 0.17 per cent to close at 40,939. Both the broader market indices, that is, Nifty Midcap and Smallcap, closed with losses of 0.53 and 0.08 per cent, respectively. Barring Nifty IT, Nifty Realty, and Nifty Financial Service, all the other sectoral indices witnessed selling pressure and ended the day in the red, with Nifty Metal and Nifty FMCG being the top losers.   

In overnight developments, the US stocks did well yesterday and all three main benchmark set new intraday records. The strength on Wall Street mirrored positive sentiment after the world’s two largest economies, that is, the US and China, reached the phase-one agreement. Further, homebuilder confidence rose to the highest level in 20 years. In the end, Dow added 101 points, the S&P 500 gained 23 points, and the Nasdaq jumped 79 points. Europe, too, finished higher, extending gains from the previous sessions despite some mixed economic reports in the region.