A morning walk down Dalal Street: Stock specific volatility to continue

A strong day for Indian markets as benchmark indices closed at fresh closing record highs. The Nifty50 climbed 11,450 while Sensex rallied over 200 points. The Nifty50 formed a bullish candle on daily charts but analysts still advise investors to remain cautious.

Buying in select Index heavyweights boosted benchmark indices and pushed them to finally close the day with gains of over 0.25 percent. 

But, mid-caps and small-caps continued to underperform the broader.

On the macro front, the International Monetary Fund (IMF) reportedly said that India's central bank will need to gradually tighten monetary policy further due to rising inflation, mainly driven by higher oil prices and a falling rupee. 

With headline index trading at record highs, some consolidation cannot be ruled out.

Analysts’ expect stock specific volatility to continue with more corporate earnings scheduled in the next 1-2 weeks. 

Further, market participants would keep an eye on global developments especially the US-China trade war, progress of monsoon, currency and crude oil price movement.

The index formed a bullish candle on the daily charts after two successive bearish candles. 

The next crucial resistance for the index is placed at 11,500-11530 while support is placed at 11,330.