Stock Market this week: Indian equity benchmarks ended the first week of New Year 2024 slightly in negative terrain amid concerns that the Red Sea disruptions pose short-term risks to global supply chains and freight costs. Besides, the output of India’s eight core industries slipped to a six-month low of 7.8 per cent in November 2023 due to a decline in the output of crude oil and cement sectors.
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These signals led the BSE Sensex to decline 214 points, or 0.3 per cent, at 72,026 during the week ended on January 05, 2024.
While the Nifty slipped 21 points, or 0.1 per cent, to 21,711. Sector-wise, the BSE Realty index surged the most (7.9 per cent) during the week. At the same time, BSE Power and BSE Healthcare indices have registered a gain of 3.4 per cent, and 3.3 per cent, respectively. On the other hand, the BSE Metal index tanked by 1.9 per cent.
As many as 24 stocks in the Nifty 50 index delivered a positive return for investors in the week. With a weekly gain of 12.7 per cent, Adani Ports and Special Economic Zone emerged as the top gainer in the index. It was followed by Oil & Natural Gas Corporation (5.5 per cent), Bajaj Finance (5.2 per cent), Tata Consumer Products (3.3 per cent), and Cipla (3.2 per cent). Sun Pharmaceutical Industries, and Axis Bank, also advanced by over three per cent. On the other hand, Eicher Motors, JSW Steel, and Shree Cement declined 6.4 per cent, 5.8 per cent, and 5.6 per cent, respectively.
Technical Outlook
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Nagaraj Shetti, Senior Technical Research Analyst, at HDFC Securities said, after showing a sustainable upside bounce on Thursday, Nifty shifted into an up move with volatility on Friday and closed the day higher by 52 points. An identical open and close pattern was formed on Friday (with an upper margin of 5 points), which indicates a type of doji pattern at the highs (not a classical one). Normally, doji formations at the highs calls for caution for longs. But, the formation of this pattern amidst range movement, hence the sharp negative implication can’t be expected.
He further said, “The short-term uptrend status of Nifty remains intact, but the market is likely to find resistance around 21800-21850 levels in the coming sessions. A decisive move only above 21850-21900 levels could open the next upside target of 22200 levels. Any dips from here could find support around 21500.” Shetti said.
Market outlook
Vinod Nair, Head of Research at Geojit Financial Services said, that the week began strong with optimism about future rate cuts, easing global inflation, and softer bond yields. However, concerns over weak China and Eurozone manufacturing data, along with Red Sea tensions, led to a flat market close. Fed minutes added uncertainty around the delay in the future Fed’s rate cut.
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He added that amidst global concerns and in anticipation of muted upcoming earnings season, the IT and Auto sectors exhibited weaker performance throughout the week. Conversely, mid, and small-cap segments sustained their rally, buoyed by healthy retail inflows. “Notably, the realty sector emerged as the top performer, propelled by expectations of robust demand and healthy housing loan disbursement data announced by banks”, Nair said.
