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Wednesday, December 7, 2022

Nifty IT shows signs of strength, Bank Nifty headed towards 44K: Analyst

The Indian equity market rallied strongly on the expiration day of the November series. Bank Nifty and Sensex witnessed a new all-time high, while Nifty ended with a record close. The drop in the dollar index and US bond yields following some dovish comments in the US Fed minutes boosted confidence in global markets.

The sharp drop in crude oil prices, on the other hand, is serving as the cherry on top for Indian stock markets. Banking stocks were doing well, but IT stocks took the lead today. The rally in the final hour can be attributed to a quick coverage move when call writers got stuck. There is a good chance that Nifty will hit an all-time high tomorrow or in the next few days.

Technically, 16611 and 16888 are the next target levels for Nifty, while 18400 and 18250 will act as immediate and strong support levels. There are no signs of weakness, and the Nifty is holding up beautifully to its immediate moving averages. Nifty IT is also showing signs of strength, and may start to do well once it breaks through the 30500 mark decisively.

Bank Nifty continues to outperform and is likely to head towards the 44000 mark; however, 43333 is an immediate hurdle. On the downside, 42600 has become an immediate support level.

Santosh Meena is Head of Research, Swastika Investmart

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