European markets were strong on Friday, and the US indices followed suit with a good move. However, Asian markets are down this morning, and the global short-term trend may be turning down. We may therefore see a few stock decline today.
The market rallied on Friday, with the sensex up 196.86 points (1.30%) at 15,318.60, the Nifty 51.70 points (1.17%) at 4,464.00, and the CNX Midcap 131.50 points (2.22%) at 6,043.80. The biggest positive contributions to the sensex came from Reliance (55.4 points), Tata Steel (21.1), ICICI Bank (20.4), NTPC (13.4), ONGC (12.9), Hind Unilever (10.5), Mahindra (10.2), State Bank (9.8), Reliance Comm (9.4), BHEL (8.0), TCS (7.1), Tata Motors (7.0), Maruti Udyog (6.8) and Ranbaxy Labs (5.3). The largest negative contribution was 4.4 points from HDFC Bank.
The market's breadth was healthy, with advances outnumbering declines 1.69 times on the BSE, and 2.11 times on the NSE. The volume in advancing issues was 86.6% (64.4%) on the BSE, and 90.2% (59.4%) on the NSE, while that in declining ones was 12.5% (32.5%) on the BSE, and 9.4% (40.0%) on the NSE.
The number of Hotline stocks at 200-day highs went up from ten to sixteen, while the number at 200-day lows dropped from one to zero. The number at 5-day highs went up from 114 to 150, while the number of at 5-day lows dropped from 10 to 8. The 240 stocks averaged a gain of 2.00%.
The nifty opened higher and rallied till 1205, and then remained in a 25-point band for the rest of the session. The CNX Midcap opened higher and rallied from start to finish, going sideways between 1145 and 1230.
The newly established intermediate looks more stable after last week's rally, and does not appear to be under any immediate threat. The uptrend would end if the sensex were to fall below 13,871, the nifty under 4,040, and the CNX Midcap under 5,420.
This uptrend has seen the sensex and nifty outperform the CNX Midcap Index, even though the mid-cap index has a larger gain last week. The uptrend is now exactly two weeks old, with an intermediate bottom established at the August 17 low of 13,780.
A closing below 13,780 would therefore signal a bear market. The equivalent for the nifty is 4,002, and 5,420 for the CNX Midcap. There was no change in the major trend of any Hotline stock on Friday.
The market had come close to entering a bear phase with the sensex retracing 90% in the last downtrend. This may make it difficult for it to reach its previous top of 15,869.
About half the global markets are in intermediate uptrends. These have survived the latest sell-offs, and we could see more uptrends now.
Most global indices are in bull phases despite losing quite a bit of ground during the last downtrend. The FTSE-100 and Nikkei appear to be in bear markets, though.
The FIIs sold USD 164.4 million of stocks on Thursday, while the MFs acquired USD 179.7 million worth. The FIIs are currently averaging daily purchases of USD 55.7 million over the last five sessions, and the MFs are buying at an average rate of USD 66.0 million.
About half the major global indices are in intermediate uptrends, and the rest should follow if the current global rally lasts a little bit more. Most major trends are up, with a couple of exceptions.
The DOW rose 119.01 points (0.90%) to 13,357.74, and the NASDAQ composite went up 31.06 points (1.21%) to 2,596.36.
Infosys was up 2.73% at USD 47.71, Satyam Computers rose 3.92% to USD 25.48, Wipro gained 4.13% at USD 14.63, Tata Motors gained 3.48% at USD 16.95, ICICI Bank went up 7.63% to USD 44.45, HDFC Bank rose 6.76% to USD 88.65, Dr Reddy's Labs gained 1.92% at USD 15.90, MTNL rose 5.01% to USD 6.92, VSNL went up 4.67% to USD 20.19, Rediff.com lost 0.20% at USD 15.07 and Satyam Infoway went up 1.85% to USD 7.71.
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