MUMBAI: The Indian equity markets rebounded on Monday with Sensex gaining over 400 points and Nifty hovering over 22,500. Both indices opened with a gap-up, snapping the 8-day losing streak, with Nifty PSU Bank emerging as a major gainer during the early morning trade.
The Sensex opened at 72,340.95 and was trading around 72,362.54, up 452.84 points, or 0.63 per cent, against the previous close of 71,909.70. Likewise, the Nifty opened at 22,532.40 and was trading around 22,543.05, up 121.10 points, or 0.54 per cent, against the previous close of 22,421.95.
All broad market indices traded in the green. Amongst the sectoral indices, Nifty PSU Bank emerged as the top gainer, surging 1.79 per cent, followed by chemicals, realty, metal, financial services, oil & gas, surging over a per cent each.
On NSE, Bajaj Finance, Shriram Finance, ITC, NTPC, Coal India, Grasim, Bajaj Finserv, SBIN, Power Grid, ONGC, LT, Axis Bank, HDFC Bank, among others were the major gainers. Apollo Hospital, Infosys, Cipla, Eternal, Asian Paints, BEL, Tech Mahindra, Nestle, among others, were the top drags.
Likewise, on BSE, Bajaj Finance, Bajaj Finserv, ITC, LT, SBIN, Axis Bank, Power Grid, HDFC Bank, NTPC, Reliance, Indi Go, among others, were the top gainers. Infosys, HCL Tech, Eternal, Sun Pharma, M&M, BEL, Maruti, among others, were the top losers during the early morning trade.
In the commodity market, Brent crude was trading at around USD 101.37 per barrel while crude oil was trading at around USD 90.01 per barrel at the time of reporting.
Market analyst Vipin Dixena sees today’s market setup as an attempt at a technical rebound rather than a confirmed trend reversal.
“What is becoming increasingly interesting for me is the valuation reset. Nifty’s forward P/E has compressed sharply towards post-Covid lows. More importantly, the correction is now visible across large caps: 42 of the 50 Nifty constituents are below their 200-DMA, indicating that the weakness is not restricted to a handful of stocks,” he noted, adding, “The 16.9x 12-month forward P/E versus the earlier 22.9x peak is therefore an important signal.”
Technically, the analyst noted that “22,200 is now the crucial support”. “If Nifty sustains above this zone, I would watch 22,600 and then 22,800 as immediate resistance. A decisive break below 22,200 can extend the correction towards 22,000”, he said.
V K Vijayakumar, Chief Investment Strategist, Geojit Investments Limited said, “Even though the headwinds coming from elevated crude prices, high US bond yields and sustained FII selling remain; the market is unlikely to be dragged down further since the valuations have tuned attractive, particularly for large-caps. There are strong tailwinds, too. The September auto sales numbers are good, indicating a structurally resilient economy”.
“The RBI is most likely to raise rates by 25bp on 7th October. The market has already largely discounted this. Banks will benefit from the rate hike since rising floating rates will improve their margins”, he added. (ANI)
