Morning Bell...Greek bailout package renewed hopes among investors.

Headlines

The Sensex opened flat on Tuesday to make a swift upward move as news of a Greek bailout package renewed hopes among investors. The Sensex was trading 87 points up at 18,375.94 and the Nifty was gaining grounds with a 26 point up move to 5,590.25.

Indian Market

The key Indian stock indices advanced modestly in early morning trade amid media reports that euro area finance ministers had reached an agreement on a second bailout package for Greece. The euro gained versus the US dollar while crude oil futures also rose after the announcement. US stock futures were also trading higher and Asian benchmarks pared some of the intraday losses.

The BSE Sensex surpassed 18,400 while the NSE Nifty crossed 5,600 in opening minutes of trade on the back of strength in Capital Goods, Realty and Power stocks. Select stocks in Oil & Gas, Metals, FMCG, PSU, Banking and Pharma sectors are also trading higher. On the other hand, Consumer Durables, IT and Teck indices are in the red.

The market breadth is positive as the Small-Cap and Mid-Cap indices are marginally out-performing the frontline indices. The BSE Small-Cap index was up ~0.8% while the BSE Mid-Cap index rose ~0.6%.

Technical Outlook

The NSE Nifty broke out above 5430 last week and closed comfortably above the resistance of 5550. This upmove happened despite uncertainty over Greece and higher oil prices. The ‘spinning top formation ’on Friday showed indecisiveness among the traders but any positive opening today would be suffice to extend the rally towards 5700. There is a 'left out' feeling in the market and every one is waiting for a dip to initiate long positions.

Outlook

Today, the Indian Markets could open lower following negative Asian cues and remain volatile in a range. The markets are likely to take cues from Dow Futures & European markets during the latter half of the session for any further direction. If the much-awaited Greek debt deal goes through, then the optimism could take the markets further higher. Immediate upside target for the Nifty is at 5700. However, weakness could emerge if the supports of 5500-5475 are broken. Among the sectoral indices, Capital Goods, IT & Banks look good, while Auto & Healthcare could underperform.

Sources-IIFL,HDFC SEC