Indian stock markets rose today after four sessions of decline. Buying was broad with pharma stocks leading the recovery. Investors await the start of the September-quarter earnings session and the RBI policy decision later this week. The Sensex was up 600 points at 59,381 after gaining 783 points at the day’s high. The broader Nifty 50 index was strong above 17,700.
Manish Hathiramani, Proprietary Index Trader and Technical Analyst, Deen Dayal Investments said, “Nifty has respected the support of 17400-17450 and has seen a good bounce this morning. Need to see if we can manage to close above the level of 17600-17700 as it will resume the current uptrend. This move should take Nifty to 18000 and above.”
“Unless we break 17400 on the close basis, the overall market trend remains bullish and the downside can be used to enter long positions,” he said.
Among sectors, the Nifty Pharma index was up 2%, lifted by a 10% jump in Divis Labs. Nifty IT index rose 0.75 per cent and TCS 0.9 per cent. IT firm Tata Consultancy Services will report its quarterly results on Friday, marking the start of the September-quarter earnings season in India.
Hong Kong benchmarks fell more than 2% in Asian markets on Monday after shares of troubled property developer China Evergrande were suspended from trading.
Evergrande is struggling to pay off more than $300 billion in debt as it ends a cash crunch caused by the tightening of the Chinese government’s restrictions on debt-leveraged financing.
“The dollar index slipping to 94.05 and the US 10-year yield slipping below 1.5 per cent could be interpreted as a sign of a return to risk in equity markets. But news coming out of China could be a pullback. China is trying to limit the damage to its real estate sector without excluding Evergrande. An inevitable consequence will be a slowdown in the Chinese economy, which will have a negative impact on commodity prices, said VK Vijayakumar, chief investment strategist at Geojit Financial Services. There will be an impact on prices and currencies of commodity exporters.
“Back home, India’s exports are booming and are inline to touch the $400 billion mark in FY12. However, the jump in trade deficit is weakening the INR. The IT segment is likely to come into focus again. Commodities, especially metals, can come under pressure.” (With Agency Inputs)
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