Markets May See Short-Term Weakness, Say Analysts

There was a good run-up in the markets, but later there was a sharp sell-off, said Aamar Deo Singh, head advisory at Angel One Ltd.

"So, the charts clearly displayed that in short-term, there is some sort of weakness, but in medium- and long-term, they look positive.”

The daily Bank Nifty charts indicate that heavyweight stocks like HDFC Bank Ltd. and ICICI Bank Ltd. have moved closer to the support levels, Singh told NDTV Profit. “Currently, HDFC has moved towards the oversold territory and close to support levels, so we could witness some consolidation. ICICI is also displaying a similar pattern with regards to HDFC."

Despite opening on a positive note, the Nifty 50 continues to face hurdles near the 21,750–21,800 zone, according to Avdhut Bagkar, technical and derivatives analyst at StoxBox. "The trend was resilient until the selling pressure mounted in the second half."

According to him, the support of 21,500 keeps floating the upside bias. "While the index succeeded in closing in green, the trend remains fragile," Bagkar said.

India's benchmark stock indices closed marginally higher on Tuesday, amid losses in the financial services sector.

The S&P BSE Sensex ended 31 points, or 0.04%, higher at 71,386.21 and the NSE Nifty 50 gained 32 points, or 0.15%, to end at 21,544.85.

The Sensex hit an intraday high of 72,035.47, while the Nifty reached 21,724.45 early in the day. 

With uncertainty around the Zee-Sony merger and possibility of the timeline getting extended, investors should delay plans to trade Zee Entertainment Enterprises Ltd. till the uncertainty is gone, said Pankaj Pandey, head of research at ICICI Direct.

“A combined entity will be better to look at. This is because the overall industry itself is consolidating, along with what we hear about the Reliance and Star merger. So, if this duo also combines, then our sense is that we will see better advertisement rates," he said.

Disclaimer: The views and opinions expressed by the investment advisers on NDTV Profit are of their own and not of NDTV Profit. NDTV Profit advises users to consult with their own financial or investment adviser before taking any investment decision.