An atmosphere of sluggishness and volatility is being seen in the Indian stock market since this morning. Due to weak signals from global markets and profit booking at the domestic level, pressure on major indices is clearly visible. Bombay Stock Exchange’s sensitive index Sensex was seen trading in the red today, while National Stock Exchange’s Nifty has also lost its psychological edge and has slipped below the important level of 24,100. The biggest reason behind this decline is believed to be the selling in shares related to metal and heavy industries, which has made investors a little cautious. Heavy profit-booking increased pressure in the metal sector. In today’s business, the metal and commodity sectors have been hit the hardest. After showing great growth in the last few sessions, today investors booked huge profits in big stocks like Hindalco, Tata Steel and JSW Steel. Experts believe that due to uncertainty regarding the demand for metals at the global level, the metal index in the domestic market also fell by about one to one and a half percent. Apart from metal, selling pressure was also seen at upper levels in some big stocks of banking and financial sector, which played an important role in pushing Nifty below 24,100. Smallcap and midcap stocks took the lead. Even though largecap stocks and main indices were sluggish today, the broader market i.e. small and medium stocks (SMIDs) saved the frontline index from a major fall today. Nifty Midcap and Smallcap indices are trading strongly in the green today. Due to continuous buying by retail investors, good growth is being seen in realty, pharma and select IT stocks. Market analysts say that due to expensive valuations in largecap stocks, the focus of investors is now shifting to quality midcap and smallcap companies, due to which the market sentiment has not become completely negative. What is the future strategy for investors? Looking at the current market scenario, experts believe that the level of 24,000 will act as a very strong support level for Nifty. As long as the market remains above this level, there is no need to panic. However, strong resistance is also visible at upper levels at 24,250 and 24,300. In such a situation, traders are being advised to avoid making too aggressive positions and adopt the strategy of ‘buy on dips’ i.e. gradually including stocks with good fundamentals in their portfolio on every fall.
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