1 month ago
Traders should limit their exposure and prefer hedged trades, with a focus on index majors and large midcaps, says Ajit Mishra of Religare Broking
March 27, 2024 / 09:56 AM IST
Analysts expect the market to consolidate in a broader range in the near term. However, buying in a broader market before the financial year end cannot be ruled out.
The Indian equity benchmark opened firm on March 27. According to analysts, the market is likely to continue in the consolidation mode for a few more days before taking a new directional trend starting April. The undertone of the market continues to be bullish supported by strong economic fundamentals.
At 9.20 am, the Sensex was up 175.61 points, or 0.24 percent, at 72,645.91, and the Nifty was up 62.40 points, or 0.28 percent, at 22,067.10.
About 1,738 shares advanced, 594 declined and 101 were unchanged. According to analysts, indications are in favour of consolidation.
Sectorally, Nifty media and realty led the gains, rising nearly a percent. Nifty PSU banks, infra, energy and auto were also trading with gains of up to 0.8 percent. Nifty FMCG and IT were the only two sectoral indices trading in the red.
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Fundamental view
Analysts expect the market to consolidate in a broader range in the near term. "However, buying in a broader market before the financial year end cannot be ruled out. Investors would watch for US consumer confidence data," said Siddhartha Khemka, Head - Retail Research, Motilal Oswal Financial Services Ltd.
A significant structural trend in the market is the sustained flows into equity mutual funds which are gathering momentum. "This will ensure resilience of the market with dips getting bought," said V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services.
Midcaps have again become the segment of activity, particularly by retail investors. This is because there is no institutional selling pressure in midcaps unlike in largecaps where institutions including FIIs have large holdings.
"Financials are likely to lead the rally along with capital goods and automobiles in early April. Credit growth in the economy is impressive at around 20 percent and this will help boost banks’ profitability. Q4 results of banks will be good," he added.
Technical view
"Nifty is trading in a tight range in the last week of March before the monthly expiry. On the lower side, 21,800 is the strong support and 22,200 is the strong resistance. Traders are advised to buy Nifty on dips with a strict stop loss of 21,800 levels on a closing basis," said Deven Mehata, Research Analyst, Choice Broking.
Traders should limit their exposure and prefer hedged trades, with a focus on index majors and large midcaps, Ajit Mishra, SVP - Technical Research, Religare Broking Ltd, said.
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Harshita Tyagi is a budding journalist on a mission to prove that financial markets and geopolitics can be as entertaining as your favorite TV show
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