Market outlook: Here’s how experts see stock action on Wednesday

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Indian equity indices, Sensex and Nifty erased morning gains to end Tuesday’s volatile session flat dragged banking and financial stocks. The benchmarks had opened the day with a gap-up but could not sustain much of the gains as volatility marred the momentum.

Previous close At close, the Sensex was down 14.37 points or 0.03% at 50637.53, and the Nifty was up 10.8 points or 0.07% at 15208.50.  Nifty Bank was down 1% and ended lower by 282 points at 34,662.

Among sectors, gains were seen in IT, metals, pharma, FMCG and auto indices. Metal stocks rebounded in today’s trade . Except, Nifty Bank, energy and PSU Bank indices all other sectoral indices ended in the green.

Asian Paints, Titan Company, Eicher Motors, JSW Steel and Britannia Industries were among the top gainers on the Nifty, while losers were HDFC Bank, HDFC Life, Reliance Industries, Axis Bank and Coal India.

Paints and auto stocks gained on unlock trade and Asian Paints & PVR closed with gains of 4% each. CONCOR continued the gaining momentum following LLF resolution. Colgate gained 5% to hit record high following an upgrade by UBS

SBI research report ‘Ecowrap’ has projected that the country’s GDP is likely to grow at 1.3% in the fourth quarter of 2020-21 and may see a contraction of around 7.3% for the full financial year . The report said that going by the estimate of 1.3% GDP growth, India would still be the fifth-fastest-growing country among 25 nations that have released their GDP numbers so far. The report findings helped markets inch towards the fag end from the low point of the day and end in the green.

Reports of a fresh stimulus package also seem to  have raised hopes of an economic turnaround soon.

ICICI Securities in its report today mentioned that it expects Nifty to resolve above lifetime highs of 15,400 and eventually head towards 16,400 over the next quarter with BFSI, consumption, auto and infrastructure leading the rally. The report suggests investors to use dips to capitalise on accumulating quality large and midcaps.

Market outlook for Wednesday

Vinod Nair, Head of Research at Geojit Financial Services.

Market witnessed a positive opening following reports of next set of stimulus measures and declining covid cases while a selling streak in banking stocks forced the market to shed its morning gains and close flat. As per the reports, the central government is preparing the next set of support measures to minimize the second wave’s economic impact, especially for worst-hit sectors.

Barring financials that witnessed profit booking, all major sectors traded in the green. Supported by global markets as Fed officials reiterated that the inflation is transitory beating down worries.

Rohit Singre, Senior Technical Analyst at LKP Securities:

Nifty again closed a day with minimal gains at 15208 and formed a bearish candle on the daily chart.

The index has very good base around 15100-15000 mark any dip near said levels will be again buying opportunity with keeping overall stop out level below 15k mark.

Until & unless we don’t see any close below 15k mark structure will be positive and we may head towards 15330-15430 zone which will be immediate levels to book profits on the higher side.

Deepak Jasani, HDFC Securities

Volumes on the NSE were a little short of recent averages as participants did not want to carry forward a lot of positions ahead of the F&O expiry on May 27. Among sectors, Consumer Durables and IT gained the most, while Banks and Power fell the most.

Asian stock markets followed Wall Street higher Tuesday as inflation fears eased and investors regained an appetite for risk. European shares rose to record highs on Tuesday, aided by a rally in tech stocks after soothing comments from the Federal Reserve and efforts by China to nail down commodity prices.

Nifty has again run into resistance closer to 15300 levels. Reports of a fresh stimulus package in India have raised hopes of an economic turnaround soon. 15137-15294 will be the trading band for the Nifty in the near term.