The Sensex rose 1 per cent and Nifty 50 index advanced 0.53 per cent for the week ended May 27, data from stock exchanges showed
The Indian equity benchmarks rose for second straight week on Friday led by gains in banking, financial services and auto shares. The Sensex rose 1 per cent and Nifty 50 index advanced 0.53 per cent for the week ended May 27, data from stock exchanges showed.
The benchmarks fell on first three days of the week but bounced back on last two days owing to a short-covering rally. Thursday's session saw heightened volatility owing to monthly expiry of May futures and option contracts.
On the sectoral front, financial services shares witnessed strong buying interest as the gauge of financial services shares Nifty Financial Services index rose 4.3 per cent. Nifty Private Bank, Bank, Auto and PSU Bank indices also rose between 1-4 per cent.
On the other hand, metal stocks witnessed selling pressure after government increased export duty on iron ore to 50 per cent, Metal index on the National Stock Exchange - Nifty Metal index dropped nearly 9 per cent. Nifty Oil & Gas, Realty, Pharma, Media and Healthcare indices also declined between 2-3 per cent.
The markets are likely to maintain bullish momentum going ahead and traders can grab opportunities to buy the dips, said Brijesh Bhatia, senior research analyst at Equitymaster.
"Nifty has formed the bullish harmonic reversal pattern at 15,750. The multiple lows in the range of 15,750-15,800, along with higher lows, confirms the reversal structure. The bullish hidden divergence on the Relative Strength Index (RSI), on the daily and weekly charts of the Nifty, also supports the bullish reversal pattern," Bhatia told Outlook Business.
"On the Nifty, 16,067-15,900 will act as support levels while the gap area of 16,450-16,600 is a major hurdle for the bulls on the upside," Bhatia added.
Meanwhile, the recent rebound in markets is on the back of positive sentiment in global markets and it may continue going ahead, explained Ajit Mishra, VP - research at Religare Broking.
"The recent rebound shows that we’re just mirroring the global markets, especially the US and it may continue ahead as well. Besides, upcoming macroeconomic data and auto sales numbers will also be in focus. On the index front, the Nifty has reached closer to the upper band of the prevailing consolidation range i.e. 15,800-16,400 and a decisive break would pave the way for the 16700-16800 zone. Meanwhile, we recommend maintaining a positive yet cautious approach and focusing more on stock selection," Mishra said.