Selling may emerge at higher levels - Consortium

Nifty has corrected by 33.80 points to close below 6050 at 6048.50. Disappointing Hindustan Unilever quarterly result along with higher royalty charge payable to parent company and weak global cues pulled down the market. Nifty intra-day declined nearly 53 points from the day's high of 6101.30. Traders booked profits in banking, metal, Tech and Realty stocks. Hindustan Unilever witnessed the biggest decline in more than 3-years. It has declined by 3.3% to close at close at Rs 481after touching day's low of Rs464.

Realty stocks witnessed profit booking (Index down 2%). HDIL declined by 7% to close at Rs112. Others like DLF and India Bull Real declined by 1% and 4% respectively. Metal stocks witnessed profit booking (Index down 0.7%). Hindalco slipped by 2.4% to close at Rs120. Others like JSW Steel, Tata Steel and Sterlite declined by 1% each.

Banking stocks witnessed profit booking from the intra-day high (Index down 0.6%). SBI declined by 1.5% to close at Rs2464 after touching day's high of Rs2564. Others like Bank of Baroda, Canara Bank, Andhra Bank and PNB declined sharply from the intra-day high.

Tech stocks witnessed profit booking (Index down 1%). HCL Tech declined by 2.5% to close at Rs698. Others like Infosys, Tech Mahindra and TCS declined marginally. Select cement stocks witnessed fresh buying. ACC has gained by 2% to close at Rs1358. Ultra Tech has gained by 1% to close at Rs1952.

For the day coming by, though positive opening is expected for the markets, but selling could emerge at higher level as the markets are clearly lacking momentum. Moreover the breadth of the market is sharply deteriorating indicating polarized markets and lack of overall conviction. Further, markets is witnessing lot of churning. Technically, yesterday sharp fall was a result of breakdown from bearish wedge pattern.

Nifty may find support at 6025 odd level and any breakdown from this level can see further pressure on markets to 6000 and then 5850. Resistance for Nifty exits far away to 6012. However, one must note that that intermediate trend is still positive, therefore aggressive shorts should be not be initiated as one could get trapped. In such scenario, it would be prudent to trade on the basis of the merit of the stock and short should be initiated in a calibrated manner. Mapping the options data, Highest Call OI is at 6200 strike with 8.9m shs up 0.7m shs and highest Put OI is at 6000 strike with 8.8m shs down 0.2m shs.

Source : Equity Bulls

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