20 hours ago
After opening with a downside gap of 115 points, the market quickly shifted into an upside recovery. The bounce continued within a range-bound movement from mid-session to the close. Buying at lower levels helped the market recover, and the session ended near the day's high, completely filling the opening gap.
Following Monday’s weakness near the 22,700 resistance level, the Nifty 50 index staged a smart recovery on Tuesday, closing on a positive note. It reversed from support around 22,300, rising to end near 22,500 and finally settling at 22,498, up 37 points or 0.17%.
A weak global outlook led to a gap-down opening, but selective buying in heavyweight stocks helped recover losses and pushed the indices higher by the close.
However, financials underperformed, weighed down by issues related to IndusInd Bank. While IndusInd Bank, Axis Bank, and HDFC Bank dragged Nifty Bank lower, ICICI Bank provided some support.
Shares of IndusInd Bank recorded biggest single-day fall, declining 27% on Tuesday, after more analysts who have coverage on the lender have issued downgrades and cut their price target on the stock. This, after the bank informed the exchanges of another negative development on March 10. The lender erased market cap of Rs 20,000 crore as the stock saw a steep fall.
Shares of real estate companies witnessed strong buying interest, pushing the Nifty Realty up by 3.6%. Telecom stocks gained following reports that the government has sought parliament's approval to spend ₹53.2 billion to upgrade telecom networks in under-served areas. Conversely, Nifty IT was under selling pressure on the back of weak global cues.
Looking ahead, global cues, particularly from the US, may continue to drive volatility.
Foreign investors continued to remain net sellers in the cash market on Tuesday, while domestic institutional investors were net buyers.
What do the Nifty 50 charts indicate?
After the negative chart pattern like lower tops and bottoms over the last few weeks, the Nifty is now in the process of forming a new higher bottom at 22,300 levels, said Nagaraj Shetti of HDFC Securities.
Shetti believes that a decisive upmove above the hurdle of 22,700-22,800 levels could confirm the bullish shift and that could open more upside in the near term. Immediate support is placed at 22,315 levels.
According to Rupak De of LKP Securities, the index might continue its strength with the potential to reach 22,660–22,700 in the very short term. Above 22,700, the Nifty might move towards 23,000. On the lower end, support is placed at 22,400 on a sustained basis.
"On the technical front, a decisive breakout from the 22,250-22,650 range could set the next directional move for Nifty; otherwise, the sideways trend may persist," said Ajit Mishra of Religare Broking.
