The weakness in the banking and midcap stocks dragged the indices lower as was advocated yesterday.
The combined exchange advance decline ratio was expectedly negative as the figures were 1093 : 2632. The capitalisation of the breadth was also negative as the commensurate figures were Rs 1052 Crs : Rs 12725 Crs.
The indices have closed at the lower end of intraday range and on higher cash volumes. That indicates an accelerated selling bias over previous session. The holiday kept buy orders in check as risk appetite was impaired.
This is borne by the relationship of the average traded prices of the index composite stocks vis-a-vis their final traded prices.
The 2775 support specified for Wednesday held as the Nifty bounced from the 2795 levels, thereby validating the near term range count.
The coming session is likely to witness a range of 2960 on advances and 2725 on declines. As long as the Nifty spot remains below the 2860 level, expect the outlook to remain weak. Conversely, a bounce above the 2900 level will see a bullish revival in the absolute near term.
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The market internals indicate a higher turnover as participation levels rose due to the selling.
The number of trades rose and the average ticket size was higher, showing a higher selling bias. The capitalisation of the market was lower.
Vijay L Bhambwani
(Ceo - BSPLindia.com)
(He is a Mumbai-based investment consultant)