What is your trading view for Tuesday 06 July? Do you see the positive trend on Nifty sustaining?

It was a tentative start for Monday but towards the second half of the day, the Nifty gained strength and closed above the 15,830 mark. On a positive note, the advance / decline ratio at 36:14 was also extremely favourable to the buy side. The rally was largely led by metal sector stocks on hope of China demand revival. Oil also contributed.

On Tuesday, a total of 268 stocks on the Nifty hit new 52-week highs as small cap stocks have gathered tremendous steam in the last few days. This is more so with sectors like sugar and technology being among the best performers. The volatility index or the VIX continues to remain subdued at the 12.07 levels, showing high levels of confidence at these levels.

It looks like selling in July is continuing as there appears to be a degree of emerging markets ennui among foreign investors. The recent yield spikes in Europe could also be unfavourable for global investors. FPIs were net sellers to the tune of Rs.338 crore on 05 Jul, while the domestic institutions infused Rs.646 crore into the markets on Monday.

The US markets were shut on Monday being a national holiday on account of Independence Day celebrations so there are no cues really from the all-important US markets for India. However, the European markets were flat to positive while the SGX Nifty is marginally in the negative in early trades 06 July. Trade could be a tad cautious on Tuesday after the rally.