Rise in oil prices can hinder market rally of last 2 months

Mumbai: A gradual rise in oil prices along with concern over high domestic food inflation may pose a hindrance to the stretched rally of the last two months, Vinod Nair, Head of Research at Geojit Financial Services, said on Thursday.

After a subdued start, the market reversed from the day’s low amid buy-on-dips strategy. However, the overall trend remained subdued, FIIs stayed muted ahead of festive break and global market traded on a negative note ahead of the announcement of the US GDP data later on Thursday, he said.

At close on Thursday, the Sensex gained 358.79 points, or 0.51 per cent, to close at 70,865.10, while the Nifty 50 rose 104.90 points, or 0.51 per cent, to settle at 21,255.05.

Some consolidation is warranted in the near term due to peak valuation, Nair said.

Mandar Bhojane, Research Analyst at Choice Broking, said the benchmark indices concluded the highly-volatile session on Thursday on positive territory, gaining 104.9 points.

A Bullish Piercing candlestick pattern has emerged on the daily chart, indicating potential bullish momentum. If the Nifty surpasses the 21,500 level, there is positional potential for an upward movement to 21,650 and 21,750 in the coming days.

Among sectors, information technology, banking, and FMCG each rose by 0.5 per cent, while metal, pharma, realty, power, and oil & gas, as well as capital goods, posted gains of 1-2 per cent each, he said.