After The Bell: Six days of rally, what should investors do on Tuesday?

Market Outlook

The Indian market rallied for a sixth day in a row, pushing benchmark indices to record highs yet again on February 8, as the S&P BSE Sensex hit 51,523 and the Nifty50 15,159.

The Sensex rose 617 points to 51,348, while the Nifty50 closed with gains of 191 points at 15,115.

On the sectoral front, the action was seen in infra, auto, metals, telecom, and consumer discretionary, while some profit-booking was seen in the FMCG space.

On the broader markets front, the S&P BSE Mid-cap index rose 1.5 percent and the smallcap index closed with gains of 1.53 percent.

Strong global cues and consistent buying by foreign investors, triggered a risk-on rally post-Budget. Investors are advised to stay long on the index as it is still a buy on dips market.

“Strong global cues supported the domestic rally. PSU Banks, which was on a bull run paused today with some correction noticeable in FMCGs,” Vinod Nair, Head of Research at Geojit Financial Services told Moneycontrol.

“The overall market is maintaining its buoyancy with a rally in all sectors, especially auto, IT and metals. Improved domestic outlook is encouraging sustained FPI inflows,” he said.

India VIX moved up by 2.30 percent from 23.41 to 23.95 levels. Now, VIX needs to cool down and hold below 21 for the momentum to continue.

Here is what experts say investors should do on February 9:

Chandan Taparia, Vice President | Analyst-Derivatives at Motilal Oswal Financial Services Limited

The Nifty formed a small-bodied bullish candle on a daily scale and continues its higher highs-higher lows formation of the last six sessions.

Now, the index has to continue to hold above 15,000 zones to continue its bullish momentum towards 15,250 then 15,500 zones, while support can be seen around 15,000 and then 14,750 zones.

Ajit Mishra, VP – Research, Religare Broking Ltd

The bulls continued to dominate the benchmark indices following supportive global cues. The Nifty index ended higher by 1.3 percent to close above the 15,100.

We are eyeing 15,200 in the Nifty and going forward earnings and global cues will dictate the market trend. Domestic market participants would actively track key macro data like IIP, CPI and WPI data.

Gaurav Ratnaparkhi, Senior Technical Analyst, Sharekhan by BNP Paribas.

The Nifty opened on a positive note on February 8 and extended higher for the sixth straight session. As a result, it has crossed the 15,000-mark on a closing basis. Going ahead, 15,250 is the key level to watch out for.

The daily chart shows that the index has reached the upper Bollinger Band, where the bands are in an expansion mode. This indicates that the upper band is likely to make room for the index to stretch higher.

Also, on the daily chart, the Nifty has created another gap, which is at 15,014-15,041. This will act as an immediate support in case of any minor dip.

Nagaraj Shetti, Technical Research Analyst, HDFC Securities

The underlying trend of the Nifty continues to be positive and one may expect further upside in the short term.

The next upside levels to be watched around 15,500, which is at 1.618 percent Fibonacci extension (connected from January 20 top to March 20 bottom). This could be achieved in the next one week. Immediate support is at 14,960.

The long-term resistance of the trend line (top to top/ bottom to bottom trend line as per monthly timeframe chart) has been violated on the upside at around 14,800-14,900 and the Nifty has closed above this level so far.

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