Nifty back in green; Reliance Industries and HDFC shine

Market Update at 12:30 PM: Nifty has recovered almost 120 points from the day’s low and it is seen trading with gains of 0.18 per cent and above the 17,400 mark. Index heavyweights like Reliance Industries and HDFC have combinedly contributed 34 points to Nifty’s kitty.  

Among the sectoral indices, Nifty FMCG and Nifty Media are the top two gainers followed by Nifty Financial Services and Nifty Metal. On the other hand, Nifty Realty and Nifty PSU Bank are down by 1.72 per cent & 0.66 per cent, respectively.  

On the options’ front, the 17,400 Call option is where the maximum open interest was added in today’s session. Hence, 17,400 is a crucial level to watch out for!  

Market Update at 10:15 AM: After opening high on Tuesday, the Indian benchmark indices have not only given up their early gains but have also entered into negative terrain. Nifty and Sensex are down by 0.40 per cent & 0.37 per cent, respectively.   

For the first time, Nifty has formed a low lower as compared to its prior bar in the last seven trading sessions.   

Among the sectoral indices, barring Nifty FMCG, all other indices are trading in red wherein Nifty Realty has lost the most by 2.64 per cent.   

The broader market indices were also seen trading in red with Nifty Midcap 100 & Smallcap 100 tumbling 0.90 per cent and 0.61 per cent, respectively.  

The domestic equity markets hit a record high for the seventh consecutive day. The benchmark index, Nifty, closed at 17,377.80 with 54.20 points gain. Nifty Realty was the top gainer, up by 3.16 per cent. Nifty IT and Media indices inched higher by 1.50 per cent and 1.32 per cent, respectively. Smallcap-100 index was also up by 1.09 per cent. Nifty Bank, financial services, pharma and FMCG indices closed with less than 0.50 per cent losses each. India VIX jumped 3.87 per cent. The overall market breadth remained marginally negative with 985 declines and 978 advances.

Nifty had a gap-up opening and thereafter, it couldn’t build upon early gains. In fact, it traded in a narrow range throughout the day and ended below its opening level. As a result, the index formed a small-bodied bearish candle on the daily chart.   

Going ahead, the level of 17,500 is likely to act as resistance while on the downside, the level of 17,340 may act as an immediate support.   

As India VIX crossed 15 and Nifty, at-the-money implied volatility crossed 14 levels. Expect higher volatility in the market from onwards. Indicators reached an overbought condition and are hinting at a pause for some time. Along with a negative opening, a close below the 17,340 would give us the first indication of a weaker signal.