Sensex reclaims 39,000, support for Nifty seen at 11350-11400

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Indian shares closed higher toady, tracking a broader rally in other markets, with gains propelled by Reliance Industries. The NSE Nifty 50 index closed up 0.56% at 11,535, while the S&P BSE Sensex ended 0.48% higher at 39,086.03. After trading range-bound for most of the session, both indices gained in late afternoon trading as European stocks and U.S. futures advanced after upbeat manufacturing data from major economies.

Heavyweight conglomerate Reliance Industries closed 2% higher while M&M surged 6%. The Nifty auto index closed up 1.15% after top automakers such as Maruti Suzuki India Ltd posted higher August sales.

Mahindra and Mahindra Ltd and Escorts Ltd also reported higher August tractor sales, pointing to strength in the agrarian sector.

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Here is what analysts said on today’s market performance:

Nagaraj Shetti, Technical Research Analyst, HDFC Securities

“The short term trend of Nifty continues to be positive. The market is gradually gaining some momentum on the upside. The underlying near term trend status remains weak and there is a chances of profit booking emerging at the higher levels. Important supports to be watched around 11350-11400. The next upside resistance to be watched at 11600.”

Vinod Nair, Head of Research at Geojit Financial Services

“After initially trading with uncertainty, the markets gained strength, in sync with positive global cues. European and Asian markets gained from encouraging economic data which could be assumed as an indicator towards an economic recovery in most of the major economies. Encouraging US, Chinese and European manufacturing data and also the expectation that US would bring in additional stimulus kept up the buoyancy in the markets. Domestically, investors chose to ignore the border tensions with China which led to the volatility in the opening trades. With markets reacting to stock specific news and with heightened volatility, Investors are advised to remain alert, trade cautiously and keep booking profits”.

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

“The Nifty made a smart move towards 11600 but was unable to get past and close above it. We would need that to happen for the uptrend to be solid and convincing. Once we get past that, our target would be 11800-11900. The support lies between 11300-11350.”

Sahaj Agrawal, Head of Research- Derivatives at Kotak Securities

“Support on the downside is seen at 11174 levels while 11700-11800 can be tested in the near term. Auto. Metal, Infra stocks can be accumulated with action expected to continue in the midcap space as well.” (With Agency Inputs)

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