Sensex, Nifty Marginally Higher Led By L&T, Reliance, ITC: Market Wrap

India’s benchmark stock indices continued to advance after a one-day fall to end marginally higher on Wednesday. Pharma, realty and energy sectors advanced, whereas information technology and non-banking financial companies were under pressure.

Sensex jumped over 65,100, while the Nifty 50 scaled over 19,460 during intraday trading, the highest in over two weeks since Oct. 23.

The S&P BSE Sensex closed 33 points, or 0.05%, higher at 64,975.61, while the NSE Nifty 50 gained 37 points, or 0.19%, to end at 19,443.59.

Currently, there are three significant trends in equity markets, according to VK Vijayakumar, chief investment strategist at Geojit Financial Services Ltd.

“One, global markets are stable, as indicated by the seven-day winning streak in the Dow and S&P 500. Two, a risk is evident in markets, primarily driven by the sharp correction in the U.S. 10-year bond yield. Three, the crash in Brent crude from around $94 to below $82 now indicates that the market doesn’t expect the Israel-Gaza conflict to aggravate into a wider regional conflict,” he said. “In brief, the market construct is favourable for the continuation of the rally, despite the geopolitical uncertainties.”

The tug of war between the FIIs and DIIs continues with sustained selling by the FIIs and sustained buying by the DIIs. Since the buy-on-dips strategy is working, retail investors are buying in the broader market on every dip, according to Vijayakumar.

“There is no selling pressure in the broader market since FII selling is confined to large caps. The best opportunity for long-term investors is in high-quality large caps, since these stocks will do well when FIIs eventually turn buyers,” he said.

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