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Market Report

Friday, 08-May-2015

NSE

  • The Sensex ended the day at 27,105.39, up 506.28 points, or +1.90 per cent. The Nifty closed at 8,191.50 today, up 134.20 points, or +1.67 per cent.

  • Benchmark indices recovered fabulously from yesterday's carnage and ended nearly 2% higher led by the gains in financials, auto and index heavyweights on government's accommodative stance on the contentious issue of capital gains taxation while firm global cues too helped in keeping the momentum going.

  • The Sensex closed 506.28 points higher today to post its biggest daily gain in four months on value-buying, after the government set up a panel to suggest ways to resolve a tax dispute with foreign investors. The index closed +0.35 per cent higher for the week ended 8 May 2015, while the 50-share Nifty index closed 0.12 per cent higher in the same period. The sentiment got a further fillip on cues from Chinese stocks, which surged on hopes of stimulus measures and monetary-easing steps after the world's second largest economy reported weak trade data.

  • Government's promise of a high-level committee to look into the MAT issue lifted sentiments while analysts attributed the rebound in global equity markets to the return of calm in global bond markets and the surprise victory of David Cameron's conservative party in the UK elections. Uptrend was also helped by the comments from global rating agencies like Fitch and Moody's that said India credit ratings will remain unaffected by the recent surge in capital outflows as relative to its peers India's external balances are strong and adequate to withstand current outflows.

  • According to analysts, the benchmark indices managed to recover losses, and the pull-back could even extent further, but it does not mean that the uptrend has restarted, say experts.

  • Expect Nifty to trade in 8,100-8,300 range, says Sandeep Wagle. The nature of the up move on benchmark indices has surprised us a bit. Does it mean that the bottom has been made? I think so. In the short term, Nifty would be trading in a range of 8,100 to 8,300. That said, the weekly charts are still negative. Till we get above 8,355 on Nifty, which is the prior swing high for me, I would not get into a bullish mode, he says.

  • Nifty may climb 8400 levels before witnessing any sustained selling, says Ashwani Gujral. What today's rally suggests is that possibly there is more pullback left. It is possible that Nifty, because of firm global cues or some clarity on MAT, climbs up to 8,400 level before witnessing any sustained decline. Nifty had opened above Thursday's intraday high levels. That was a significant event because it indicated that there were immense short positions in the market, he adds.

NIFTY 3-Month

(Data/Charts courtesy NSEI/Yahoo!/iCharts/The Economic Times)