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Taking Stock: FM comments help Nifty50 climb Mount 9K; Sensex rallies more than 600 points

May 20
18:06 2020

The bulls pushed the market higher in the second half of the trading session on May 20 to help the Nifty50 cross the crucial resistance at 9,000 while the S&P BSE Sensex saw a gain of more than 600 points.

Domestic markets traded in a range, tracking mixed global cues but positive comments from Finance Minister Nirmala Sitharaman boosted risk-on sentiment, which could have led to short coverings.

The government was open to taking further measures to alleviate coronavirus pain, Sitharaman said, a few days after the government announced a Rs 20-lakh-crore economic package.

Also read: Open to further stimulus, have done what is best in my view: FM Nirmala Sitharaman

The final tally on D-Street: the Sensex rose 622 points to 30,818 while the Nifty50 rallied 187 points to close at 9,066.

The benchmark indices closed up by more than 2 percent despite mixed global cues and spurt in coronavirus infections in the country.

“Positive statements from the Finance Minister that the government was with industry and would do as much as possible depending on how the coronavirus pandemic will pan out, implying there could be further stimulus ahead, also could have lifted markets,” Paras Bothra, President, Equity Research, Ashika Stock Broking, said.

Sectorally, action was seen in healthcare, capital goods, finance, consumer durables, and oil & gas stocks while profit-taking was visible in telecom space.

On the broader markers front, the S&P BSE Midcap index was up 1.49 percent while the S&P BSE Small-cap index closed with gains of 1.1 percent, underperforming benchmark indices.

Top Nifty gainers included HDFC, Dr Reddy’s Laboratories, M&M, and Shree Cements, which were up more than 5 percent each.

Top Nifty losers included Vedanta, Hero MotoCorp, IndusInd Bank, and Bharti Infratel.

Stocks & Sectors

Sectorally, the S&P BSE Healthcare index was up 3.1 percent followed by the S&P BSE Capital Goods index that was up 3.12 percent and the S&P BSE Finance Index gained 2.9 percent.

The telecom index was the only exception, slipping 1.5 percent.

Long Buildup was seen in stocks like Godrej Properties, Jubilant FoodWorks, Dr Reddy’s Laboratories, HDFC etc. among others.

Short Buildup was seen in stocks like Shriram Transport, Hero MotoCorp, and IDFC First.

On a day the Sensex rallied more than 600 points, around 40 stocks hit a fresh 52-week high. These included Aurobindo Pharma, Bharti Airtel and Astec Lifesciences.

Stocks in news

Dr Reddy’s Labs | The share price jumped almost 6 percent after the company reported a 76 percent year-on-year (YoY) jump in net profit for the March quarter.

UltraTech Cement | The stocks was up 3 percent after it announced a consolidated net profit of Rs 3,243 crore for the March quarter.

Reliance Industries | The share price was up almost 2 percent as the company’s rights issue opened for subscription for existing shareholders. RIL-RE settled at Rs 202 on the first day.

Bajaj Finance | The stock gained almost 4 percent after the company reported a profit after tax of Rs 948 crore for the quarter ended March 2020, a 19.4 percent decline compared to the corresponding period last fiscal.

Tata Power | The share gained 3 percent after the company reported a net profit at Rs 474.70 crore in the fourth quarter ended March 2020 against Rs 171.67 crore in a year-ago period.

Multiplex stocks continued to move higher, as PVR & Inox gained for the second day.

Technical View

The Nifty formed a bullish candle on the daily charts after five consecutive bearish candles.

The index closed above its 5-Day EMA, which is a positive sign,

Trend data suggests support at 8,800 and resistance at 9,400-9,500 on the higher side; selling pressure can increase below 8,800, say experts.

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