Morgan Stanley expects Sensex to touch 50,000; banking sector would be in action
In the West, the markets are facing ripples of bad news as US retail sales showed slowest growth in six months and the cases of coronavirus are on a surge. But, the news flow on the Indian shores is quite cheerful and the latest one is that Morgan Stanley is expecting Sensex to touch 50,000 mark by end of next year. Despite this cheerful news, the SGX Nifty is indicating markets to open flat as it trades down by 8 points at 12,889.50.
The signs of exhaustion are clearly visible in the markets as Nifty formed a hanging man pattern in the last trading session and majority of the indicators are placed in overbought territory, hence, a cool-off phase is likely, but the stock specific action is likely to continue as broader market would take over the baton from the headline indices. Further, the banking stocks are likely to remain in limelight as Supreme Court is scheduled to hear the interest waiver case today and also, the news of Lakshmi Vilas Bank being placed under moratorium will be discounted by the markets.
Asian indices were trading mixed on Wednesday following negative cues overnight from Wall Street. China’s Shanghai Composite was up by 0.41 per cent, while the Japan’s Nikkei was down by 0.76 per cent as one of the newspaper reported that Tokyo Metropolitan Government in the wake of surge of coronavirus cases over the past weeks is taking steps to raise Covid-19 alert to the highest level of four levels. Hang Seng was seen oscillating around the neutral line.
Indian markets kick off truncated week on a cheerful note and it remained in green thorough the session but it closed off the day’s high. The rally was backed by Nifty Metal and Nifty Bank as both the sectoral indices ended with gains over of 2 per cent, further, 13 out of 15 components of Nifty Metal ended in green and 11 out of 12 components of Nifty Bank closed in green. At close, Sensex and Nifty were shy of key milestone level of 44,000 and 12,900. In the broader indices, Nifty Midcap surged by 1.11 per cent, while Nifty Smallcap ended with minuscule gains. Meanwhile, the India VIX added 3.5 per cent.
On Tuesday, US stocks trimmed some part of their earlier losses and ended the day with modest losses. The rising cases of Coronavirus cases as US is now home to more than 11 million coronavirus cases and what is more concerning is that the last one million cases have been added in the last week one week alone according to Johns Hopkins Covid-19 data. Further, sentiments were dampened as retail sales came in below expected in the month of October. Despite the negative back drop there was one stock which surged like there is no tomorrow and it was Tesla stock jumped more than 8 per cent after the announcement that the stock would be added to the S&P 500 index. At close, the Dow was down by 0.6, S&P 500 dipped 0.5 and Nasdaq dropped 0.2 per cent. Meanwhile, the European indices ended on a mixed note on Tuesday.