The S&P BSE Sensex has erased half of its early morning gains and is now up 100 points after a gap up of nearly 200 points on strong cues from the global markets.
The European markets have open in green. CAC was the biggest outperformer with over 1.5 percent gains followed by DAX up 1% and FTSE up 0.5%.
Traders are now focusing back on the domestic cues and expect the Finance Minister to announce more measures to jump start the sagging economy.
Broking house Sharekhan is bearish on the market. The research firm in it noon update advise traders, “The short-term bias would remain negative for a target of 5550 with reversal around 5810. The medium term outlook would also remain negative, as the index has completed a W-X-Y pull-back and also formed an ending diagonal pattern in the last leg.”
Stocks from interest rate sensitive sectors like banking and realty are rallying on short covering. Buying is also seen in metal stocks.
The broader markets have outperformed largecaps today. Stocks like Essar Oil, GMR Infra, Opto Circuits, Core Education, HDIL, IRB Infra made money for traders.
Safe-haven or popularly termed as defensive stocks in market parlance are trading lower on profit booking. However, if the market loses steam then these stocks will be once again back on buyer’s radar.
The rollover in Bank Nifty is around 18% in afternoon trade. India VIX is down 2.7% at 15.12. Nifty 5700 Put has added 10.5 lakh shares in open interest.
Fresh long position is seen in DLF and GMR Infra. Short covering is witness in Reliance Communications, Shree Renuka and HDIL.
In the currency space, the euro has strengthened above 1.30, while the dollar index has slipped towards 82. Brent crude is steady above 108 dollar levels.