The Indian stock market traded in the green on Wednesday, with Sensex and Nifty recording gains of up to 0.5% despite big tailwinds like oil prices falling below $99 per barrel.

Sensex gained over 350 points to rise above 74,896 while Nifty rose over 104 points to trade above 23,433, as seen at 11.15 am. Broader markets outperformed benchmarks, with Nifty Midcap 100 rising 0.4% and Nifty Smallcap 100 jumping 0.7%.

Bajaj Finance and Bajaj Finserv shares were the top gainers on Sensex, as the Bajaj twins gained around 2% each. UltraTech Cement, Tata Steel, Asian Paints, L&T, Kotak Mahindra Bank, Hindustan Unilever and ITC shares gained around 1% each. Bucking the trend, Infosys and TCS shares fell around 1%.

Among the sectors, Nifty Metal jumped more than 1%, while Nifty IT slipped into the red. The overall market sentiment turned positive, with NSE seeing 2,332 advances against 714 declines, while 109 stocks remained unchanged.

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The structure of the market in recent days has been technically weak with a downward bias, said VK Vijayakumar, Chief Investment Strategist, Geojit Investments. He noted that if this market construct is to change, there should be some significant triggers. A sharp dip in crude prices can provide that trigger. But that is not happening even though Brent crude has dipped below $99. Another positive trigger can come from a dip in US bond yields. But that is unlikely in the present macro scenario of high inflation, particularly in the developed countries, the analyst noted. In brief, these two factors - high crude prices and elevated bond yields- will constrain a rally in the market, he said.

Domestic liquidity is supporting the broader market, with market activity now focused on the broader market, Vijayakumar pointed out. Good growth and better growth prospects are attracting investment into many mid-and small-caps. But valuations in these segments are getting stretched. “This trend has created a dichotomy in valuations- attractively valued large-caps coexisting with highly valued mid-and small-caps. Experience tells us that reversion to the mean is inevitable, but its timing is hard to predict,” the analyst said.

On the higher side, 23,600-23,650 will act as major resistance for Nifty as this zone is the last week high and the recent breakdown area, said Pabitro Mukherjee, Deputy Vice President-Research, Bajaj Broking. The index needs to sustain a higher high and higher low formation and reclaim 23,650 to signal a pause in the ongoing downtrend, he added.

On the downside, a breach below the previous week’s low of 23,115 will resume the corrective phase towards the 23,000 and 22,800 levels, according to the technical analyst.

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Disclaimer: This article has been written by Debaroti Adhikary, who is not a SEBI-registered Research Analyst or an Investment Adviser. Debaroti Adhikary and his/her ‘relative(s)’ (as defined under Section 2(77) of the Companies Act, 2013) do not hold any financial interest in the companies mentioned in this article as of the date of publication. The views/recommendations mentioned in this article, wherever applicable, are those of the respective SEBI-registered Research Analyst/brokerage and have been reproduced/reported with due attribution. They should not be construed as the views or recommendations of The Economic Times Digital or the journalist. Readers are advised to consider the original research report and make their investment decisions based on their own assessment. Brokerage disclaimers here.