Market is choppy, use dips to accumulate
The market rebounded driven by buying in bank, IT and auto stocks amid lacklustre global cues. Overcoming a bout of volatility in late-afternoon trade, the BSE Sensex ended 172.69 points or 0.43 per cent higher at 40,412.5, while Nifty climbed 53.35 points or 0.45 per cent to close at 11,910.15.
NTPC was the top gainer in the Sensex pack, spurting 2.77 per cent, followed by ONGC, Tech Mahindra, Kotak Bank, TCS, Asian Paints, IndusInd Bank and Tata Motors, which gained up to 2.28 per cent.
'Technically, Nifty continued its formation of lower highs — lower lows over the last four sessions but formed a Bullish candle on daily scale. Now pace of selling may get pause as it is respecting to its key support area of 11800 zones after the profit booking decline of 300 points from its life time high of 12158 marks. Now index needs to negate formation of lower lows of last four sessions by surpassing above 11923 marks to witness an up move towards 12000-12035 zones while on the downside major support exists at 11800 zones,' said Siddhartha Khemka, head, retail research, Motilal Oswal Financial Services.
Global sentiment was cautious ahead of the deadline for new US tariffs on Chinese goods. In Asia, Tokyo and Bangkok ended lower, while Hong Kong rose 0.79 per cent and Shanghai added 0.2 per cent. Seoul and Singapore also finished in the green.
'The momentum readings on the intraday chart showed a positive divergence during the day which played out well in the last hour to pull the indices higher. In last few sessions, market has given up some of the recent gains. However, this just seem to be a correction within an uptre-nd and hence, we continue with our advised for traders to take this dip as an opportunity to accumulate stocks for positional trades,' said Ruc-hit Jain Equity Technical Analyst, Angel Broking.
As bulls remain on sidelines, moves are choppy and recoveries are not sustaining and the market in consolidation phase.
'After a subdued trade during most part of the day, market witnessed a sharp turnaround due to short covering in index heavyweights. Upcoming macro indicators like consumer price index inflation and Index of Industrial Production (IIP) data are unlikely to paint a rosy picture which may reduce upside potential in the near term. On global front, FOMC meeting, the UK election and US-China tariff deadline remain key events,' Vinod Nair, head of research at Geojit Financial Services.