Weekly Market Update: After a seven-week winning streak, Indian market indexes closed the week down 0.5 percent due to profit booking at higher levels.
SUMMARY
- During the week ended December 22, the BSE Sensex down 377 points, or 0.53 percent, to 71,107, while the Nifty fell 107 points, or 0.50 percent, to 21,349
- As many as 18 firms in the Nifty 50 index returned a profit to investors. Britannia Industries emerged as the top gainer in the NIFTY pack with a weekly gain of 5%.
- Among sectors, the BSE FMCG index gained the highest (1.4%) during the previous week. While the BSE Healthcare and BSE Oil & Gas indices have increased by 1.1% and 0.7%, respectively.
After a seven-week winning streak, Indian market indexes closed the week down 0.5 percent due to profit booking at higher levels. According to figures from the commerce ministry, India’s merchandise exports fell 2.83 percent to $33.90 billion in November 2023, down from $34.89 billion the previous year. Imports fell to $54.48 billion in November 2022, down from $56.95 billion in November 2022. Furthermore, the new Covid-19 fear caused by the discovery of a new version in states such as Goa, Kerala, and Maharashtra harmed market sentiment.
The BSE Sensex down 377 points, or 0.53 percent, to 71,107 during the week ending December 22, while the Nifty fell 107 points, or 0.50 percent, to 21,349. Among sectors, the BSE FMCG index gained the highest (1.4%) during the previous week. While the BSE Healthcare and BSE Oil & Gas indices have increased by 1.1% and 0.7%, respectively. The BSE Auto and BSE Power indices, on the other hand, fell by more than 1.5%.
During the week, 18 firms in the Nifty 50 index produced positive returns to investors. Britannia Industries was the index’s biggest gainer this week, with a 5% weekly gain. It was followed by Nestle India (4.1 per cent), Tata Consumer Products (3.9 per cent), Coal India (3.8 per cent), and Wipro (3.6 per cent). Reliance Industries, Cipla, Hindalco Industries, and Hindustan Unilever all increased by more than 2%. Mahindra & Mahindra, HDFC Life Insurance, and UPL India, on the other hand, fell 5.3%, 4.9%, and 4.8%, respectively.
Weekly summary
According to Amol Athawale, Vice President, Technical Research at Kotak Securities, “the benchmark indices witnessed volatile activity in the last week; after a roller-coaster movement, the nifty ended 0.55 percent lower while the Sensex shed over 375 points.” During the week, the Nifty/Sensex reached a new all-time high of 21593/71913, but it quickly retreated due to relentless profit booking at higher levels. The Nifty/Sensex has corrected about 600–1900 points from its weekly highs. Following a severe dip, it took support near 21000/70000 and rebounded rapidly.
Athawale went on to say that because the market’s short-term texture is turbulent, level-based trading would be the best method for day traders. “As long as the index is trading above 21200/70700, the pullback formation is likely to continue,” we believe. Above there, the market might rise to 21500-21550/71500-71650.” On the other hand, if the price falls below 21200/70700, the mood may shift. Below that, the market may revisit the 21100–21000/70400–70000 barrier.
“For Bank Nifty, 47000 may serve as a sacred support zone, above which it may rally to 48000-48300.” However, an increase below 47000 would be susceptible. Below there, it might fall to 46700-46500.” According to Athawale.
Market Prospects
According to Vinod Nair, Head of Research at Geojit Financial Services, the ‘buy on dips’ approach is still driving investors during the down week. Mid and small caps remain in the spotlight, benefiting from reduced oil prices and the expectation of a likely rate cut in CY24, aided by slower-than-expected US GDP growth and dollar weakness, indicating early rate cuts.
He said that, despite a premium valuation, the short-term positive trend continues, bolstered by a robust resurgence in FII buying and stock-specific actions. “Heading into the festive season and year-end, we can anticipate a range-bound trade scenario with limited data points,” Nair told reporters.
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