Market gave up all its early morning gains on account of heavy selling in key heavyweights after the announcement of RBI policy. RBI raised interest rates by only 25 bps but remained committed on tightening as inflation control remained its top priority. Banking stocks rallied initially but failed to sustain higher levels. The Auto counters also encountered selling in the late trades. Nifty lost more than 100 points from its intraday top and closed below 5700. In fact, Nifty gave up all its gains of past 3 sessions. Global cues are positive and that may keep some positive bias as the markets re-open on Thursday. Nifty is likely to see expiry just around 5700. Banking stocks have seen some technical rebound and it seems that there is still some steam left in the rebound. One could utilize any weakness to accumulate the banking counters like SBI, ICICI, Yes Bank, BOI, BOB and Allahabad bank. Auto stocks remain weak and are a typical sell on rallies stocks. Tata Motors has some support around 1150 and close below 1150 could further weaken its technical set-up. HUL lost more than 5% after its quarterly numbers. Stock closed below 290 and sustained trades below 290 could mean more weakness in this heavyweight. RIL finds some support around 950 and has held this support for past 24-30 months. Positional traders could buy RIL on weakness with perspective of 4-6 weakness. Tata Steel has some resistance around current levels of 655-660. Short covering might sustain it around current levels on Thursday but some correction is expected after January expiry.
Nifty has immediate support around 5650 and then around 5610 while resistance is at 5740-50.
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