All the sectoral indices ended with gains as the Nifty Media and Pharma indices rise 6 percent each and Information Technology and Realty indices climb 3 percent each.
Indian benchmark indices witnessed smart recovery, gaining more than 2 percent in the week ended March 11 and broke a four-week losing streak amid volatility due to the ongoing geopolitical tension between Russian and Ukraine.
In the last week, the BSE Sensex added 1,216.49 points (2.23 percent) to end at 55,550.3, while the Nifty50 rose 385.15 points (2.37 percent) to end at 16,630.5 levels.
All the sectoral indices ended in the green with the Nifty Media and Pharma indices rising 6 percent each and Information Technology and Realty indices climbing 3 percent each.
Among broader indices, BSE Mid-cap Index rose 3 percent, Small-cap index jumped 3.2 percent and Large-cap Index added 2.2 percent.
Foreign institutional investors (FIIs) sold equities worth Rs 24,688.44 crore, and domestic institutional investors (DIIs) bought equities worth Rs 17,729.12 crore. However, in March, FIIs sold equities worth Rs 43,303.05 crore and DIIs bought equities worth Rs 30,329.05 crore.
Nearly 90 small-cap stocks gained 10-38 percent, including Take Solutions, Dwarikesh Sugar Industries, BGR Energy Systems, IOL Chemicals, Khaitan Chemicals, Gujarat Ambuja Exports, HEG, Avadh Sugar & Energy, Reliance Infrastructure, Sarda Energy and Minerals, JK Paper and Gujarat Narmada Valley Fertilizers & Chemicals.
However, KBC Global, JK Cement, Elgi Equipments, GTPL Hathway, Future Lifestyle Fashions, Jindal Stainless, KEC International, Quess Corp and Future Retail lost 8-14 percent.
“Nifty started trading for the week with a gap down opening amid negative global news flows. The index sneaked below the 15,700 mark, but it then witnessed a smart recovery for the rest of the week and recovered more than 1,000 points from the low to end well above 16,600,” said Ruchit Jain, Lead Research, 5paisa.com.
“Although we started the week on a negative note, the markets witnessed a V-shaped recovery to end the week on a positive note. However, if we look at the recent historical data, then it is seen that 16,800 has been a pivotal level which was the crucial support breached in the last week of February," he said.
The markets then sold off sharply and on pullback move now, this level has become a hurdle. The index needs to take out the hurdle of 16,800-17,000 zone.
“The main reason for the recent volatility was the geopolitical tensions between Russia and Ukraine which had cascading on commodities (which rose sharply) and equities. Hence, positive news from this crisis would only be a trigger to take the equity markets out of this situation,” he said.
“Until we see the index surpassing this hurdle, traders are advised to trade with a stock specific approach and avoid aggressive positions. The immediate supports for the Nifty are now placed around 16,350 and 16,200, said Jain.
The BSE Midcap index rose 3 percent with Indraprastha Gas, Balkrishna Industries, Jindal Steel & Power, Jubilant Foodworks, L&T Finance Holdings, Oberoi Realty, Zee Entertainment Enterprises and Tata Consumer Products gaining 7-14 percent.
The BSE 500 index added over 2 percent, led by the IOL Chemicals and Pharmaceuticals, HEG, JK Paper, Gujarat Narmada Valley Fertilizers & Chemicals, Gujarat Heavy Chemicals, Balrampur Chini Mills, Infibeam Avenues and Swan Energy.
“Markets had a terrible start to the week gone by as tensions escalated between Russia and Ukraine over the previous weekend. This resulted in a massive gap down on Monday. Fortunately, the damage was not much thereafter as we witnessed Nifty making attempts of stabilising around 15,700,” said Sameet Chavan, Chief Analyst-Technical and Derivatives, Angel One.
“After this, the global uncertainty subsided a bit which resulted in complete V-shaped recovery in the following two sessions. Since the market was deeply oversold, the speed at which it made a comeback, was really remarkable. Eventually, with some range-bound movement on Friday, Nifty ended the week with decent gains over a couple of a percent.”
Where is Nifty50 headed?
Next week the market will focus on the reduction of commodity prices and diplomatic development between Russia and Ukraine. If these global trends turn positive, the performance of the Indian market will be good or else it may get choppy.
The market will also focus on inflation data to be released in India and the US, and the US Fed and the BoE meeting is scheduled for next week.
The brief consolidation can continue in the range of 16,400-16,800 after which the index will be set to extend higher. Thus a potential minor degree dip towards 16,450-16,400 can be taken as a fresh buying opportunity. Beyond 16,800, the Nifty is expected to test 17,000 in the short term.
The markets will first react to the IIP data in early trades on Monday. Besides, development on the Russia-Ukraine crisis and movement of crude will remain in focus.
On the index front, a decisive move above 16,800 in Nifty would further fuel the recovery, else sideways to negative move will continue. Participants should stay light and wait for clarity.
