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Driven by strong gains in financial stocks, Indian markets posted strong gains for the second consecutive day. The Sensex finished 371 points higher today at 32,114 and has now risen 25% from the lows of March 24 at 25,638. Firm world markets and expectations of further government stimulus helped raise domestic equities. The broader Nifty finished 1% higher at 9,380. The Nifty Bank banking index rose nearly 3% today to 20,671.
Among the financiers, IndusInd Bank increased 17%, Bajaj Finance 9%, HDFC 8%, while Axis Bank and ICICI Bank increased 7% and 4% respectively. Some profit-taking was observed in pharmaceuticals and select consumer goods.
Europe’s markets were mostly higher after a mixed session in Asia as governments moved slowly to allow companies to reopen and central banks to step in with even more support for crisis economies.
This is what market analysts said about today’s market action:
Rohit Singre, senior technical analyst at LKP Securities.
“The index closed one day at 9381 with gains of 1 percent and formed a type of dragon fly doji on the daily chart, suggesting uncertainty in the markets. The index has formed strong resistance near the area of If the index managed to hold above 9400, then we could see some more gains towards the 9500 mark overall hurdle zone and on the downside index it has good support near the 9270-9200 zone. Nifty Bank closed one day on 20671 with gains of almost 3 percent and formed a bullish candle on the daily chart. Support for Nifty Bank is approaching 20,500 -20,300 zones and resistance is approaching 20,900-21,150 zones. “
Vinod Nair, Head of Research at Geojit Financial Services
“Benchmarks ended with a positive follow-up to world markets, led by finances. Hopes for a fiscal stimulus have provided support to the markets. Reactions to specific news of the stocks are taking place based on the results and management’s comments. The sustainability of this recovery depends on the relaxation of closure measures and measures to get companies back to normal. “
Manav Chopra, CMT, Head of Research – Equity, Indiabulls Securities Ltd.
“Nifty is hinting at a short-term breakout that, if materialized, is likely to push Nifty higher by around 200 points, however one should not miss the big picture as we are generally in a bear market recovery From a broader perspective, we continue to be bullish on the index and I think the next biggest move is to the downside, and the index is likely to retest 7,500-7,700 to the downside over a period of 9,150 is the support in the short term to the downside and a violation below the mentioned levels will cause a sharp drop in the downside. “
S Ranganathan, Head of Research at LKP Securities
“The market today is on the back of a fierce afternoon move by finance. HDFC Ltd and Bajaj Finance led the charge, which was well supported by Axis Bank and IndusInd Bank. RIL’s disarmament exercise through a planned rights issue also helped markets hold on to their profits. “
Ajit Mishra, VP – Research, Religare Broking Ltd.
“After a solid start, Indian markets witnessed Tuesday’s trade shortage despite strong global signals. However, banks and financial stocks supported the market for the second day in a row and Nifty closed higher. 1.1% at 9,381 levels. Wider markets – small and mid cap also ended with decent gains. “
“The recent buoyancy in banking is certainly an encouraging sign, but we believe that others should also contribute to a sustainable rise in benchmark. In coming sessions, we expect earnings announcements particularly from the Nifty Pack (HUL, Tech Mahindra) and F&O expire will continue to lead specific stock changes this week. We reiterate our opinion focusing on stock selection and business management amid prevailing uncertainty. “
