The domestic stock market began on Tuesday flatly, with the Sensex and Nifty 50 indices showing minimal movement amidst mixed global signals. The Sensex edged down by 6.57 points, or 0.01%, settling at 81,349.28. In contrast, the Nifty 50 saw a marginal gain of 3.30 points, or 0.01%, closing at 24,839.40. The broader market indices also opened with a mix of performances.
Tuesday’s session reflected the cautious sentiment prevalent across Asian markets, which experienced declines, while Wall Street equities remained largely unchanged overnight. Investors are closely watching the US Federal Reserve’s upcoming rate decision and comments expected later this week to confirm their expectations of a rate cut in September.
Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, highlighted that robust retail investor enthusiasm and steady capital flows into mutual funds are likely to support the market. However, he pointed out concerns about high prices across the market. Institutional investors buying high-quality stocks with strong earnings visibility bolstered the ongoing positive trend.
Market participants are particularly attentive to the FOMC meeting scheduled for July 31st, with Fed Chairman Jerome Powell’s remarks being closely scrutinized for any indications of a potential rate cut.
Despite the flat closing, the Nifty 50 showed resilience throughout the session, rallying on the back of positive global cues and nearly testing the 25,000 mark before pulling back to end below 24,850. The index’s continued uptrend shows no signs of a reversal, maintaining healthy market breadth while FIIs have added fresh long positions post-expiry.
Technical indicators suggest that while the uptrend remains intact, there might be some consolidation or a pullback towards support levels within the broader uptrend. The RSI readings indicate this possibility, suggesting a slow and gradual move in the index with stock-specific actions dominating the broader market. Immediate support levels for Nifty 50 are around 24,620 and 24,500, while resistance levels are seen at 25,065 and 25,340.
Traders are advised to focus on stock-specific opportunities and align their trades with the primary trend. Ruchit Jain, an analyst, notes that despite the Nifty 50 ending flat, the index has shown a strong uptrend with no immediate reversal signals. Jain advises traders to continue seeking opportunities in individual stocks while keeping an eye on the overall market direction.
Among the stocks in focus, Indian Oil Corporation (IOC) and DLF have shown promising patterns. IOC, having consolidated within a range over the past few months, appears poised for a breakout. Traders are encouraged to buy within the range of ₹180-177, targeting ₹189 and ₹196, with a stop-loss below ₹171.
DLF, on the other hand, has broken out from a falling trendline resistance, supported by increasing volumes and positive RSI momentum. Short-term traders can look to buy on declines within the range of ₹855-850, targeting ₹900-910, with a stop-loss below ₹830.
