Domestic equity benchmarks the Sensex and the Nifty remained in the green for the third consecutive session on July 19 primarily led by gains in banking stocks.
Global cues remained mixed even as reports emerged that European Central Bank (ECB) is considering a bigger-than-expected rate hike.
"European Central Bank policymakers are considering raising interest rates by a bigger-than-expected 50 basis points at their meeting on Thursday," reported Reuters.
Oil prices rose amid weakness in the dollar as strong US sales data underpinned hopes that the US Fed may not raise interest rates by a full percentage point at its meeting next week.
Brent Crude traded near the $105 a barrel mark while the rupee inched up 3 paise to close at 79.95 per dollar.
Hope that the Indian economy is well placed to withstand a global slowdown is also underpinning market sentiment.
"Developed markets traded negatively due to slow hiring plans announced by blue-chips MNCs like Apple Inc. in anticipation of global economic slowdown. However, due to the Indian economy’s strong fundamentals, we believe that the immediate impact of the slowdown in the domestic economy will be milder than of global peers," said Vinod Nair, Head of Research at Geojit Financial Services.
Sensex rose 246 points, or 0.45%, to end at 54,767.62 while the Nifty settled 62 points, or 0.38%, higher at 16,340.55. The BSE Midcap and Smallcap indices closed 0.68% and 0.88% higher, respectively. Among the sectoral indices, realty, auto, bank and metal clocked decent gains.
Shares of Axis Bank, IndusInd Bank, Mahindra & Mahindra, Tata Steel and UltraTech Cement ended as the top gainers in the Sensex index while those of Nestle, HCL Tech, Sun Pharma, Kotak Mahindra Bank and Dr Reddy's Labs ended as the top laggards.
Nearly 100 stocks, including Adani Enterprises, Eicher Motors, Mahindra & Mahindra Financial Services, Siemens and TVS Motor Company, hit their fresh 52-week highs in intraday trade on BSE.
"Indian markets are standing out amidst global volatility. The energy crisis seems to be coming back with Saudi Arabia declining to increase production and Russia cutting gas supplies to Europe. The dip in the dollar index from its highs has supported emerging markets," said Siddhartha Khemka, Head - Retail Research, Motilal Oswal Financial Services.
"On the domestic side, strong momentum is seen in rural-focused stocks with healthy progress in the monsoon. Even PSU Banks were in the limelight after the government announced the delisting of two public banks. Midcap stocks have seen a sharper recovery with improvement in sentiments and value buying. Going forward, the market setup is positive with the overall structure changing to ‘buy-on-dips’ from earlier ‘sell-on-rise’. With the ongoing result season picking up pace, stock-specific action is likely to continue," Khemka added.
Technicals
Nifty remained strong during the session as it moved above the previous swing high on the daily timeframe. As per Rupak De, Senior Technical Analyst at LKP Securities, Nifty formed a higher top higher bottom formation on the daily timeframe. Besides, it sustained above its major moving average suggesting a bullish trend.
"Over the short term, the index may remain positive as long as it sustains above 16,100 with a potential to reach 16,450-16,500 over the short term," said De.
Mazhar Mohammad, Founder & Chief Market Strategist, Chartviewindia.in is of the view that sustaining above 16,187, Nifty can test its 200-day EMA, placed around 16,520 which capped the upswing in the past. Therefore, it remains critical for this index to clear this hurdle to continue the expansion on the upside.
"Till then this pullback swing shall remain vulnerable to a sudden sell-off. Meanwhile, failure to sustain above 16,187, on a closing basis, should induce a fresh bout of selling pressure in the index. Considering the critical resistance for the index around 16,500, we advise traders to book profits in the zone of 16,450 – 16,500 and remain on the sidelines," said Mohammad.
Disclaimer: The views and recommendations made above are those of individual analysts not of MintGenie.
