Market Notes

The headline indices experienced another day of consolidation, accompanied by a significant sell-off in European markets. The dollar has stabilized somewhat, while oil prices are rallying due to geopolitical tensions and the Ukrainian attack on Russian oil infrastructure. The IT sector enjoyed an impressive rally, with strong breadth. Although the sector is deeply oversold on the charts, this rebound appears to be a mean reversion rather than a technical buy or trend reversal. Some stocks are breaking out, while others are consolidating recent gains, indicating that the market is experiencing lower participation and is not entirely bearish. However, sustained rallies are mainly occurring in select sectors like auto and certain pharma stocks. The infra sector shows limited breadth despite the headline indices performing well.

The eClerx stock has reached all-time highs and leads the IT sector in terms of relative strength and momentum factors.

The breakout of Aadhar Housing Finance to all-time highs has persisted despite the market's relative weakness, providing a solid setup with a rally following a strong base formation on the daily charts.

Apollo Microsystems has also reached all-time highs after testing the breakout zone. This stock is currently in the midst of a significant rally, with a strong possibility of further gains in the coming days.

Shriram Pistons and Rings has experienced a notable breakout, and its low-beta nature is advantageous in this scenario.