Street signs: 15,800 key for Nifty, headwinds for gold financiers & more

15,800 key for Nifty

The markets went through consolidation last week, dropping 1 per cent after three straight weeks of gains. The Nifty closed at 16,049, slightly above its 50-day moving average of 16,027. Technical analysts say the market trend will remain positive as long as the Nifty manages to stay above the immediate support of 15,800. “Only a break below 15,800 will then lead to a resumption of the downtrend and until then, one should be optimistic from a short-term perspective,” said Ruchit Jain, lead research, 5paisa.com.

Mid-caps see buying interest

Buying interest is seen returning to the broader markets. The Nifty Midcap 100 index with a one-month gain of nearly 5 per cent has outperformed the Nifty50, which is up 2.3 per cent during the same period. The Nifty Smallcap 100 index is still a laggard with a one-month gain of 1.4 per cent. Experts say it is only a matter of time that this universe, too, will outperform, if the positive momentum continues. Due to sharp underperformance since October, the risk-reward now favours mid- and small-caps for investors with at least a three-year investment horizon, say fund managers.

Headwinds for gold financiers

Shares of gold finance firms, such as Muthoot Finance and Manappuram Finance, may come under pressure because of the softness in the price of yellow metal. Last week, international gold prices fell to their lowest level in 

11 months. Fears of aggressive monetary tightening and a strong greenback are weighing on the performance of gold. Domestic gold prices have not fallen as much as international prices due to the recent import duty hike. Shares of Muthoot and Manappuram only slightly underperformed the market last week.

Contributed by Sundar Sethuraman