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  Business   Market  10 Aug 2019  Markets may consolidate after 2 days of gains

Markets may consolidate after 2 days of gains

THE ASIAN AGE. | RAVI RANJAN PRASAD
Published : Aug 10, 2019, 1:26 am IST
Updated : Aug 10, 2019, 1:26 am IST

The broader Nifty-50 Index gained 77.20 points or 0.70 per cent as it closed at 11109.65.

The broader market gains were stronger with BSE Mid-Cap Index up 0.77 per cent and BSE Small-Cap Index up 1.00 per cent.
 The broader market gains were stronger with BSE Mid-Cap Index up 0.77 per cent and BSE Small-Cap Index up 1.00 per cent.

The benchmark indices rose for the second day on hopes of roll back of super rich tax on foreign portfolio investors and other measures to boost economy. The Sensex closed 254 points or 0.68 per cent up at 37581.91.The broader Nifty-50 Index gained 77.20 points or 0.70 per cent as it closed at 11109.65.

The foreign portfolio investors were net buyers of equities worth Rs 203.73 crore while the domestic institutions were net buyers by Rs 606.92 crore.

The broader market gains were stronger with BSE Mid-Cap Index up 0.77 per cent and BSE Small-Cap Index up 1.00 per cent.

Friday's rally was led by auto stock as BSE Auto Index gained 1.99 per cent, the other sectoral gainers included BSE Bankex (0.97 per cent), Consumer Durable (1.39 per cent), Realty (0.97 per cent).

Technical View
Dharmesh Shah, Head-Technical, ICICI Direct said, "Equity benchmarks snapped four weeks' losing streak as Index bounced from extreme oversold territory last week. Broader markets performed in tandem with benchmarks as the Nifty Mid-Cap and Small-Cap indices rose by 1.65 per cent and 1.1 per cent respectively."

"In the process, Index posted strongest four day pull back (3.7 per cent) signifying structural turnaround, well supported by across sector buying effort. In the coming truncated week, we expect the index to consolidate in a broad range of 10900-11300 levels with stock specific action," Shah said.

Mehul Kothari, Senior Technical Analyst, IndiaNivesh said, "Now Nifty is back to 11100 mark. Technically, Nifty has taken support at long term trend line, thus the low of 10780 will now remain a very critical support for the markets.

Market View
Jimeet Modi, Founder & CEO, Samco Securities said, "After witnessing ultra-pessimism, equities made a smart recovery pinning hopes on the Government to grant relief in the form of reduction in FPI surcharge tax which may or may not happen. Such sharp rallies are often a result of some pep talk or some relief measure which often fizzles out trapping the bulls who bought on the hopes that a new rally will begin. For the fact that market was so deeply oversold, a rally was in any case expected," Modi said.

However, current rally may not last longer and market may consolidate next week.

Vinod Nair, Head of Research, Geojit Financial Services said, "The market was hoping for more than 20 per cent growth in corporate earnings in FY20 for the Nifty50 Index stocks while Q1FY20 has started on a muted note. With lowering GDP growth estimates, we expect further downgrade in corporate earnings. While interest rate cut is expected to provide some respite for the market in the near term. Going ahead investor's will closely monitor government measures on supporting growth and FPIs tax issues."

Tags: nifty-50, bse