After The Bell: Market mixed, what should investors do on Wednesday?

Market Outlook

Indian markets ended mixed on May 25 as investors preferred to book profits at higher levels. The Nifty managed to hold on to 15,200 after retesting 15,300 in intraday trade, while the S&P BSE Sensex closed with a negative bias at 50,637, 14 points down. The Nifty gained 10 points to end at 15,208.

Broader markets mirrored the benchmarks, the BSE midcap index fell 0.3 percent and the smallcap index rose 0.2 percent.

Sectorally, buying was seen in consumer durable, consumer discretionary, and IT stocks, while profit-taking was seen in power, energy, banks and capital goods space.

“The 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,” Vinod Nair, Head of Research at Geojit Financial Services told Moneycontrol.

Reports said the government is preparing the next set of support measures to minimise the economic impact of the second wave, especially on the worst-hit sectors like hospitality and aviation.

Barring financials that witnessed profit booking, all major sectors traded in the green, supported by global markets as Fed officials reiterated that the inflation was transitory, Nair said.

Here’s what experts think that investors should do on May 26:

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

Technically, the Nifty formed a bearish candle on the daily scale with a long lower shadow. The index has to hold above 15150 zones to witness an up move towards 15300 then the lifetime high of 15,431. On the downside, support exists at 15,100 and 15,000.

India VIX fell by 1.5 percent from 19.13 to 18.84 levels. India VIX needs to hold below 20 zones to extend the bullish market momentum towards the new lifetime territory.

Manish Hathiramani, Proprietary Index Trader and Technical Analyst, Deen Dayal Investments

The level of 15,300 posed resistance on May 25. If the index goes past it, it can touch 15,550-15,600. The Nifty has support at 14,900-15,000 and till it holds that level, it is in bullish territory. Any correction can be utilised to accumulate long positions.

Rohit Singre, Senior Technical Analyst, LKP Securities

The Nifty closed the day with minimal gains at 15,208 and formed a bearish candle on the daily chart. The index has a very good base around the 15,100-15,000 mark and any dip near said levels will be again a buying opportunity with keeping overall stop-out level below the 15,000 mark.

Unless the index closes below the 15,000 mark, the structure will be positive and the Nifty may head towards 15,330-15,430, which will be immediate levels to book profits on the higher side.

Mohit Nigam, Head, PMS-Hem Securities

The stocks of HDFC group, HDFC Bank and HDFC Life, took a beating and were the top Nifty losers joined by Axis Bank and Reliance Industries, down by more than 1 percent.

A strong player in the mobile and digital messaging space, Route Mobile has shown strong traction, registering gains of more than 11 percent.

The Nifty seems to be in the 15,100-15,300 range with the absence of a fresh trigger to move in either direction. However, it’s still a buy-on-the-dip market.

Disclosure: MoneyControl is a part of the Network18 group. Network18 is controlled by Independent Media Trust, of which Reliance Industries is the sole beneficiary.

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