Benchmark indices Nifty and Sensex hit new record highs on July 19, extending gains for the fifth session in a row ahead of the Union budget. This comes just a day after the Sensex cruised past 81,000 and Nifty attained a new high of its own.
However, soon after the opening, the frontline indices slipped into the red as investors booked partial profit.
The Sensex was down 0.15 percent at 81,222 and the Nifty was down 0.16 percent at 24,762. About 944 shares advanced, 1,444 shares declined, and 113 shares unchanged.
"The overall trend for the market continues to be positive and the flows in the index heavyweights are keeping the trend intact even as we see divergence in the broader markets," Ruchit Jain, research analyst at 5paisa, told a Source
The broader markets continued their underperformance from yesterday after the midcap and smallcap indices opened lower by 0.9 and 0.8 percent, respectively. Many experts believe that its robust outperformance in the last three months isn't likely to continue after the Union Budget as flows will head toward large-cap companies.
The VIX, often referred to as the fear gauge, edged higher slightly by 1.6 percent to settle around 14.7.
"We are now eyeing the new milestone of 25,000 in the Nifty. However, the recent underperformance of the broader indices is tempering the overall buoyancy," Ajit Mishra, senior vice president of research at Religare Broking said. "Amid these mixed signals, we reiterate our recommendation to focus on stock selection and prefer hedged positions, given the anticipated rise in volatility due to the upcoming Union Budget and ongoing earnings season," he added.
IT heavyweight Infosys was buzzing in trade after a robust Q1 and positive guidance prompted brokerages to issue bullish calls on the counter. Jain said that IT space even before TCS' result was before the TCS results started witnessing an uptick as participants are now looking for sectors that haven't rallied in the past year. Infosys was the top gainer on the Nifty, trading almost 4 percent higher at Rs 1,821.
Among sectors, IT was the only sector that traded in the green led by Infosys. LTIMindtree, HCL Tech, and TCS were other major contributors. The realty index was the worst hit, followed by the metal and energy index.
"Nifty witnessed a huge positive bullish candle to create history once again scaling 24800 levels and with the undertone maintained strong can achieve the 25,000 level in the coming sessions before the budget announcement," Prabhudas Lilladher said in a recent report. "The index continues to gain strength making new highs each day and with the support zone now escalated to 24,400 levels, has next higher targets of 25,000 and 25,400 levels visible," it added.
Infosys, LTIMindtree, HCL Tech, Britannia Industries, and ITC were the top gainers on the Nifty. Power Grid, BPCL, Hindalco, UltraTech Cement, and Tata Steel edged higher.
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