Upward rally may continue
For now, 63,700 levels would act as a trend decider level, above which it could rally till 64,300-64,400; On flip side, below 63,700pts the uptrend would be vulnerable.
Private sector banks lead Sensex lower
Kumud Das
On Wednesday, the benchmark index BSE Sensex registered a fresh all time high of 64,050.44, after a promising intraday rally, as it gained by 499 points. Among sectors, Metal and Pharma indices outperformed, both the indices rallied over 1.5 per cent.
“Technically, the index opened with a gap-up and held the positive momentum throughout the day, on daily charts, the index has formed breakout formation and it also formed bullish candle, which supports further uptrend from the current levels,” says Shrikant Chauhan of Kotak Securities.
For the breakout traders now, 63,700 levels would act as a trend decider level. Above the same, the index could rally till 64,300-64,400. On the flip side, below 63,700pts the uptrend would be vulnerable. Below the same, traders may prefer to exit out form the trading long positions.
Christy Mathai, Fund Manager (Equity), Quantum AMC, says: “Valuations around the long-term average makes a strong case for reasonable returns as earnings up cycle gains strength.” Investors could be better off by staying invested and maintain their equity allocation in line with long term asset allocation plans.
Indian markets are at an all-time high, driven by strong inflows from the FII the past few months. From a macro standpoint, India stands out relative to peer countries, with inflation moderating, investing activity and growth picking up. Growth hurdles of Indian economy has corrected to a large extent.
Infrastructure has been improving consistently, corporate balance sheet strength has improved, and financial system is in a robust state to fund the potential growth. Despite the recent rally, fundamentals point to the possibility of strong earnings growth in medium term.
