Sensex rises 300 pts from day’s low, Nifty above 22,700: Value buying among key factors behind market gain

As per the latest business developments, Benchmark index Sensex rose 300 points from day's low while Nifty 50 was trading above the 22,700-mark due to various reasons, including value buying.

At 9:56 am, the Sensex was up 217.41 points or 0.3% at 72,746.48, and the Nifty was up 7.55 points or 0.03% at 22,723.75. Around 2,288 shares advanced, 1,066 shares declined, and 159 shares were unchanged.

Key factors behind market gain

1) Value buying

Value buying emerged at softer marks as markets were noted in oversold territory.

2) India VIX eases

India VIX, the volatility index, was trading nearly 2% softer at 13.17, which indicates lesser nervousness among traders at large. 3) Technical reason

Nifty has to trade below 22,650 for further bearishness to emerge in the market, stated market watchers.

"The short-term trend stays weak, although a quick pullback surge cannot be ruled out. For day traders, 22,600/72,200 stays an important backing zone. Sustaining above this level could trigger a pullback toward 22,850–23,000 on the Nifty and 73,000–73,500 on the Sensex. On the downside, a break below 22,600/72,200 could intensify selling pressure and drag the indices toward 22,500–22,300/72,000–71,400.

"Overall, the market stays vulnerable to volatility, with 22,500/72,000 acting as the immediate pivot for the next directional move," stated Shrikant Chouhan, Head Equity Research, Kotak Securities.

"Immediate bias in the index remained down and a follow through softness will signal extension of slide towards the key backing area of 22,400 being the confluence of the trendline backing joining the major lows of the past two years and the 200-week EMA. A move above 22,830 will signal a pullback towards the 23,000 marks. That stated, for a meaningful trend reversal index would require forming a sustained Elevated High–Elevated Low structure and reclaim the 23,000-23,100 level. A sustained move above 23,100 could signal a pause in the ongoing correction.

"The daily stochastic has approached oversold territory with a reading of 13, hence a pullback after the recent sharp slide cannot be ruled out," stated Pabitro Mukherjee, Deputy Vice President-Research, Bajaj Broking.

"The market may attempt to stabilise after the recent slide, supported by buying emerging around key technical marks in both indices. That stated, persistent FII selling stays a concern and could restrict the recovery. With Nifty and Bank Nifty near important backing zones, intraday price action is likely to stay range-bound with a wary undertone," stated Hitesh Tailor, Technical Research Market observer at Choice Broking Private Limited.