Positive global cues, hopes of recovery through vaccine drive amid a rise in COVID cases helped bulls to put up a strong show for the second consecutive day in a row.
The S&P BSE Sensex rallied by over 200 points while the Nifty50 reclaimed 14,700 levels.
Let’s look at the final tally on D-Street – the S&P BSE Sensex rose 272 points to 48,949 while the Nifty50 gained 106 points to close at 14,724.
Sectorally, buying was seen in metals, auto, IT, as well as oil & gas index. On the broader markets front – the S&P BSE Midcap index rose 0.9 percent, and the S&P BSE Smallcap index rose 0.59 percent.
“Amid rising covid cases, hopes of recovery through vaccine drives and a positive global market is aiding the domestic market to ride a positive wave,” Vinod Nair, Head of Research at Geojit Financial Services said.
“Biden’s decision to waive intellectual property rights on vaccines pumped in global optimism. Metal stocks continued to outshine other sectors as it kick-started earning season on a better-than-expected note. Auto and IT were the other sectoral leaders while mid and smallcap stocks mirrored the trend,” he said.
Here is what experts say investors should do on May 7:
Chandan Taparia, Vice President, Analyst-Derivatives, Motilal Oswal Financial Services Limited
Technically, Nifty50 formed a Bullish candle on the daily scale with long lower shadow indicating declines were being bought.
Now, the index has to hold above 14700 zones to witness an up move towards 14880 and 15000 zones while on the downside, support exists at 14600 and 14500 zones.
Rohit Singre, Senior Technical Analyst at LKP Securities.
The index gave a close at 14733 with gains of nearly one percent and formed a bullish candle for the second consecutive day. The Nifty index again is coming closer to its strong hurdle zone of 14800-14900, and a fresh breakout is possible if the index sustains above 15,000 mark.
We have witnessed profit booking from said levels in the recent past. On the downside, good support is formed at 14670-14600 zone.
Manish Hathiramani, proprietary index trader and technical analyst, Deen Dayal Investments
Nifty is able to sustain above this level for a day or two. If Nifty sustains above 14,700 for a session or two, the markets can scale up to 15100-15200.
On the flip side, we could drop back to 14400 and continue downwards to 14000-14100. We are in a “wait and watch” situation and have to tread this phase patiently.
Mazhar Mohammad, Chief Strategist – Technical Research & Trading Advisory, Chartviewindia.in
Nifty is struggling around the 50-Day simple moving average (SMA) and yet to decisively clear this hurdle. Hence, the current strength which is visible shall remain vulnerable to a sudden downfall.
Contrary to this, if the Nifty breaches 14600 levels, then the weakness shall initially drag it down towards 14500 levels.
For the time being, it looks prudent to remain neutral on the index by shifting focus towards stock-specific opportunities whereas traders with long side bias on Nifty are advised to maintain a stop below 14600 levels.
Disclaimer: The views and investment tips expressed by the investment expert on Moneycontrol.com are his own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
