Last week, Nifty continued its momentum and hit a new high for three consecutive days. However, on Thursday, the market was under selling pressure and added a distribution day.
Market status: Confirmed Uptrend
Distribution days: Three
Global stock markets: Dow30, +0.2%; S&P500, -0.1%; Nasdaq, -0.2%; Nikkei, +0.7%; Kospi, +0.1%; Hang Seng, +0.1%
Last week, Nifty continued its momentum and hit a new high for three consecutive days. However, on Thursday, the market was under selling pressure and added a distribution day. On Friday, Nifty made a new high but remained volatile throughout the session and closed 0.3% higher. Nifty Midcap and Smallcap relatively underperformed the benchmark indices. Nifty is trading 3.5% and 9.0% above its 21- and 50-DMA, respectively.
On the sectoral front, Nifty PSU Bank and Metal closed 6–8% higher for the week. Nifty Bank, Energy, IT, and Financial Services closed 1.5–2.0% higher. On the flip side, Nifty Auto and Metal were down 1.2% and 0.5%, respectively.
We maintain a positive view of the overall market as indices trend into new highs with low distribution day count. Further, leadership remains widespread across multiple sectors. We continue to recommend a selective approach to increase risk. Focus on high-quality ideas emerging from sound bases with an RS line at or near a new high. After a strong rally, pullback/consolidation (if any) is a constructive sign if Nifty holds its short-term moving averages. On the flip side, tracking distribution days is crucial. Accumulation of distribution days can be a sign of market top and halt the uptrend.
Key News
Last week, FIIs were net buyers on all the five trading sessions. They cumulatively bought stocks worth Rs 16,719 crore.
Pfizer (Nse) has received an emergency authorization from the USFDA for its Pfizer BioNTech Covid-19 vaccine.
Central Bank Of India has approved the proposal to raise capital funds up to Rs 500 crore.
Kec International has received new orders worth Rs 1,438 crore across segments.
Union Bank Of India issuing bonds up to Rs 1,500 crore on a private placement basis.
O’Neil Market Condition Report
For the 24 emerging markets tracked by our institutional research team, the market status breakdown is as follows: Confirmed Uptrend, 92%; Rally Attempt, 0%; Uptrend Under Pressure, 8%; Downtrend, 0%.
For the 24 developed markets tracked by our institutional research team, the market status breakdown is as follows: Confirmed Uptrend, 67%; Rally Attempt, 0%; Uptrend Under Pressure, 33%; Downtrend, 0%.
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