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Market Report

Thursday, 19-May-2016


  • The outcome of the state assembly elections bolstered the ruling BJP on Thursday, raising hope that it will improve the chances of a reforms push. The market traded in the red throughout the day. The S&P BSE Sensex, which slipped over 70 points in opening trade, ended the day 304.89 points, or -1.19 per cent, down at 25,399.72 today while the Nifty50, which hovered around its crucial support level of 7,850, closed at 7,783.40 down 86.75 points, or -1.10 per cent.

  • Markets suffered losses after likelihood of an interest rate hike by the US Federal Reserve in the month of June resurfaced. A win for the BJP in Assam failed to uplift the mood on the street as downfall in the global equities amid decline in the crude oil prices dampened sentiments.

  • A favourable election verdict for the BJP in the assembly elections for four states has rekindled hope that it will help the government push key reform bills and help it win the support of smaller parties to get key legislations passed in the Upper House of Parliament, experts said. The big victory in Assam election could well sustain the market at current level, but a break out looks unlikely as global conditions continue to act as headwinds. But if the government manages to push through the GST, it could well lead to a breakout.

  • The Nifty50 cracked over 80 points today to close below its crucial 200-day moving average (DMA), placed around the 7,801 mark, thus forming a 'bearish belt hold' pattern on the daily candlestick charts. A 'bearish belt hold' is referred to as a trend reversal pattern and it holds more importance if formed after a consolidation. If the index stays below the 7,780 level on Friday, the selling pressure could intensify, technical experts said.

  • Unless Nifty50 breaks the 7,800 level and trades decisively below it, I would say the signal is for no trade. Certainly, I do not want to be adventurous to buy the lows. I want to be careful with whatever longs I may have, because most people will have longs, said Dr CK Narayan.

NIFTY 3-Month

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