Domestic equity benchmarks the Sensex and the Nifty clocked healthy gains on November 1, extending their gains into the fourth consecutive session, as investors remained hopeful that the US Fed will not throw a negative surprise on rate hikes on November 2.
The US Fed Reserve FOMC Meeting for November 2022 is scheduled for November 1-2 in which a 75-basis-point increase in lending rate is widely expected. Analysts hope that the US Fed will deliver a smaller 50-bp increase in its December meet.
Sensex opened at 61,065.58 against the previous close of 60,746.59 and touched an intraday high and low of 61,289.73 and 60,868.69 respectively. The index closed 375 points, or 0.62%, higher at 61,121.35. Nifty50 closed at 18,145.40, up 133 points, or 0.74%.
Midcaps performed better as the BSE Midcap index closed 1.04% higher; the Smallcap index ended with a gain of 0.26%.
Shares of NTPC, Power Grid, Dr Reddy's Labs, Infosys and TCS closed as the top gainers while those of Axis Bank, Maruti and Reliance Industries ended as the top laggards.
Among the sectoral indices, BSE Power and Utilities rose more than 2%. IT, Teck, and Healthcare indices rose up to 2%.
As many as 126 stocks, including Mahindra & Mahindra, Bharti Airtel, Granules India, Eicher Motors and Bank of Baroda, hit their 52-week highs on BSE.
The overall market capitalisation of BSE-listed firms rose to ₹282.1 lakh crore from ₹279.9 lakh crore in the previous session, making investors richer by ₹2.2 lakh crore in a single day.
Crude oil prices rose amid reports that China was planning to ease Covid curbs. Brent Crude traded near the $94 per barrel mark. The rupee ended 7 paise higher at 82.71 per dollar.
"The bulls are driving the trend in the domestic market with backing from FIIs and the global markets. The PMI numbers show that manufacturing activity in India remained strong in October and that pricing pressures were kept in check as new orders and production increased, albeit slowly," Vinod Nair, Head of Research at Geojit Financial Services observed.
"Investors are keeping an eye on the central banks' policy meetings for any indications of a slowdown in the pace of rate hikes," said Nair.
Technical views by analysts
After starting higher the Indian Nifty remained strong throughout the session. Rupak De, Senior Technical Analyst at LKP Securities pointed out that on the daily chart, the index has moved above the previous swing high.
"The daily RSI is in a bullish crossover. The trend remains strong as long as it remains above 18,000. On the higher end, resistance is visible at 18,300," said De.
Shrikant Chouhan, Head of equity Research (Retail), Kotak Securities pointed out that after promising 18,000/60,500 breakout last Tuesday, the market opened with a gap up and after a strong opening the entire day it was hovering between 18,060-18,175/60,870-61,280.
In addition, on daily charts, Nifty formed a Doji candlestick formation which indicates indecisiveness between the bulls and bears.
Chouhan, however, added that the medium-term texture of the market is still on the positive side.
"For the trend-following traders now, 18,050/60,870 would be the trend decider level. Above these levels, the benchmarks could move up to 18,250-18,300/60,400-60,500. On the flip side, quick intraday correction is not ruled out, if they succeed to trade below 18,050/60,870," said Chouhan.
"Below these levels, the Sensex and the Nifty are likely to touch 17,950 -17,900 and 60,500-60,400 respectively. The short-term texture of the market is mildly overbought hence level based trading would be the ideal strategy for the day traders," said Chouhan.
Key market data
Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of MintGenie.