Market Report: Indian Benchmark Indices - June 6, 2024

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Market Overview

The Indian stock market ended higher for the second consecutive session on June 6, amidst significant volatility. The Sensex surged by 692 points to close at 75074, while the Nifty gained 201 points, ending at 22821. This positive movement reflects a continued rebound from previous sessions.

Nifty Analysis

• Opening & Closing: The Nifty witnessed a gap-up opening, consolidating throughout the day and holding onto its gains.
• Daily Performance: On the daily charts, Nifty has shown a sharp recovery in recent sessions, reaching the 22,900 level, aligning with the 78.6% Fibonacci retracement level from the fall of 23,340 to 21,280.
• Future Expectations: Given the significant run-up and the approach towards a crucial resistance level, a consolidation phase is expected. The anticipated short-term range for Nifty is between 21,800 and 23,000.
• Volatility Index: INDIAVIX decreased by 12%, closing at 16.59, indicating reduced market uncertainty.

Sector Performance

• Top Gainers: Realty, IT, and Oil & Gas sectors led the gains.
• Lagging Sectors: FMCG and Pharma sectors were the major underperformers.
• Sector Highlights:
  • Realty sector emerged as the top performer with gains exceeding 4.5%.
  • Media and PSU Banks also saw notable gains.
  • FMCG and Pharma sectors experienced declines.

Bank Nifty Analysis

• Performance: Bank Nifty had a rangebound trading day.
• Support & Resistance Levels: Key support is identified at 48,800 - 48,500, while resistance is pegged at 49,700 - 50,000.

Broader Market Performance

• Midcap & Smallcap Indices: Both indices outperformed the benchmark, with midcaps gaining 2% and smallcaps rising by 3%.
• Breadth of Market: A total of 2,740 shares advanced, 668 declined, and 70 remained unchanged, indicating broad-based buying interest.

Technical Indicators

• Candlestick Pattern: Nifty50 formed a Spinning Top candlestick pattern, signaling indecisiveness between bulls and bears.
• Key Levels: Immediate support is seen at 22,485, with resistance at 23,080-23,130.

Major Gainers & Losers

• Top Gainers:
  • HCL Technologies
  • Shriram Finance
  • SBI Life Insurance
  • Tech Mahindra
  • SBI
• Top Losers:
  • Hindalco Industries
  • HUL
  • Asian Paints
  • Hero MotoCorp
  • Nestle

Outlook and Strategy

The market has adjusted to recent election outcomes and is buoyed by stability on the global front. While a brief pause or consolidation may occur post-rebound, the overall market sentiment remains positive. It is advisable to adopt a "buy on dips" strategy, focusing on quality stocks during pullbacks. With broad sector participation, investors should stay vigilant for opportunities across various segments.

Conclusion

The Indian stock market displayed robust performance with widespread gains across various sectors, led by realty, IT, and PSU banks. As the Nifty approaches critical resistance levels, a period of consolidation is anticipated. However, the overall bullish trend suggests continued opportunities for investors, especially with reduced market volatility and a positive macroeconomic backdrop.