After the huge selloff on Monday hitting investors’ wealth to the tune of ₹3.53 trillion, the Indian indices are expected to witness some short-covering today, say experts. They said that after the bear run on Dalal Street yesterday, Indian stock market has slipped into the oversold condition and 14,200 can work as a major support for the Nifty in upcoming trade session. Some news on Covid like Modi Government allowing vaccination of people above 18 years of age and lending financial support to the Covid vaccine manufacturers in India may also boost the morale of investors. On how to maximize one’s returns if the short-covering happens, the stock market experts suggested intraday traders to limit their trade in Future & Option (F&O) and shift some focus towards cash segment. They asked both traders and investors to look at quality stocks in the pharma, IT and FMCG sectors.
Speaking on the market strategy for upcoming trade session Saurabh Jain, AVP — Research at SMC said, “After the Monday bloodbath at Dalal Street, it seems like Indian indices are in oversold condition and I am expecting some short-covering when the market opens today. Some boost for the market is also expected from yesterday’s news in regard to Narendra Modi Government allowing vaccination for Indians above 18 years of age. Apart from that, there is buzz about the central government giving financial support to the COVID vaccine manufacturers in India. This is also going to boost the morale of the market investors.”
Sharing the major levels for NSE Nifty Nagaraj Shetti, Technical Research Analyst at HDFC Securities said, “The short term trend of Nifty seems to have reversed on Monday, after a reasonable up move of the last three sessions. But, fine upside recovery raises some hopes for bulls to make a comeback for the short term. Having placed at the crucial lower supports of 14,200 and the chart pattern of daily and weekly time-frame, one may expect minor upside bounce in the next few sessions up to the gap hurdle of 14,550.”
Asked about the sectors that will aid Dalal Street recover from the Monday losses Saurabh Jain of SMC said that pharma, IT and FMCG sectors are expected to outperform other indices in next few trade sessions.