After opening lower, domestic markets remained subdued all through the day on the back of heavy selling and did manage to hold the opening gap. In fact, the indices seemed to be going for a free fall in the second half before they managed to cut some of their losses in the final hour. Sensex closed 199 points lower, while Nifty finished 53 points down. Mid-cap and small-cap indices also posted losses for the day. On the weekly chart, Sensex has formed a bearish engulfing pattern, which indicates that in medium term the index is under the grip of bears until it breaches 9637 (corresponding level for Nifty is 2970). However in shorter span, we see a bounce up to 2865 in Nifty. Intraday charts indicate that falling wedge is under formation, whose breakout will occur once Nifty clears the hurdle of 2760. Bears dominated the market breadth with 927 declines and 276 advances.
Hourly KST has given a positive crossover. Our short-term bias is up for the target of 2865 with reversal nailed at 2705. However, our mid-term bias is still down for the target of 2450 with reversal pegged at 3111.
Today, stocks across all the sectors took the beating with the banking and information technology stocks taking the maximum hit. Of the 30 stocks that make Sensex, ACC (up 1%) and Maruti Suzuki India (up 0.5%) led the pack of gainers whereas ICICI Bank (down 7%), Reliance Communications (down 5%) and Reliance Infrastructure (down 4%) topped the losers’ chart.