Nifty will go down sharply if it closes below 8,250
In Monday’s closing report, we had mentioned that NSE’s CNX Nifty may go sideways. However, for the positive trend to continue the Indian benchmark has to stay above 8,270. The 50-share Nifty opened Tuesday in the positive and stayed in the green for major part of the session. Each time the index moved lower it took support at Monday’s close and bounced back. However after 2pm, the index witnessed a sharp fall, breaching the support and recovered to close marginally higher.
The S&P BSE Sensex opened at 27,612, while Nifty opened at 8,346. The benchmarks hit a high at 27,670 and 8,357, respectively. Sensex hit a low of 27,325 and closed at 27,426 (down 160 points or 0.58%), while Nifty hit a low of 8,268 and closed at 8,299 (down 24 points or 0.28%). India VIX rose 2.31% to close at 16.4825. NSE recorded a volume of 79.89 crore shares. The Nifty made several unsuccessful attempts to head higher but has been stuck around 8,300. It is now ready to make a major move. If it closes below 8,250, the downfall will be sharp and quick. If not, it will struggle to move higher.
India's Index of industrial production (IIP) increased at five-months high pace of 3.8% in November 2014, recovering from the sharpest pace in three-years at 4.2% recorded in October 2014. The annual rate of inflation based on the combined consumer price indices (CPI) for urban and rural India rose to 5% in December 2014 from nine-year low of 4.4% in November 2014, while snapping consistent decline for last four sequential months.
The government will release data on WPI for December 2014 at 12 noon on Wednesday.
Finance Minister Arun Jaitely had said that the government has taken major steps to improve the investment climate in the last several months and it will continue to do so.
Oil prices continued to move lower on Tuesday with Brent crude and US WTI both falling to their lowest in almost six years as the global supply glut continued.
Emami (6.57%) was among the top two gainers in ‘A’ group on the BSE. The stock hit its 52-week high today. FIIs holding in the company fell from 17.23% to 16.47% as on December 2014, while DIIs holding and retail holding increased from 1.43% and 8.60% to 1.52% and 9.27% respectively.
Unitech (5.29%) was the top loser in ‘A’ group on the BSE. It was recently in news as CBI was considering the closure of Tata Realty-Unitech land deal case. The case was re-opened to probe into whether funds from the Rs1,700 crore Tata Realty-Unitech land deal were diverted for spectrum purchase. The case may soon be closed on the ground that the Supreme Court had not directed the agency to carry out more investigations into the matter.
Wipro (1.18%) was among the top two gainers in the Sensex 30 pack. There is a report that Rishad Premji, now the chief strategy officer of Wipro could assume the vice chairman's position in the coming months.
With the recent fall in the stock prices of PSU Coal India and ONGC, the finance ministry is learnt to be reconsidering sale of stake in these companies. ONGC (2.37%) was the top loser in the Sensex 30 stock.
On Monday, US indices closed deeply in the red after openly sharply higher. Asian indices showed mixed performance. KLSE Composite (0.80%) was the top gainer while Nikkei 225 (0.64%) was the top loser.
China's exports climbed more than estimated last month as stronger demand from abroad helps bolster growth. Overseas shipments rose 9.7% in December from a year earlier. Imports fell 2.4%, leaving a trade surplus of $49.61 billion, the customs administration said in Beijing.
European indices were trading higher. US Futures too were trading in green.