NIFTY OUTLOOK FOR 20 JAN 2025

 Nifty Market Report - January 17, 2025

Market Overview: The Indian equity markets remained under pressure throughout the trading session on January 17, 2025, as rising US bond yields continued to create uncertainty among local investors. Concerns over geo-political tensions, the slow pace of US rate cuts, and sustained foreign institutional investor (FII) outflows from domestic equities added to the cautious sentiment.

The Nifty 50 index closed at 23,203.20, down 108.60 points or 0.47%, while the Sensex ended lower by 423.49 points or 0.55%, closing at 76,619.33. During the day, the Nifty traded within a range of 23,292.10 (high) to 23,100.35 (low).

Key Highlights:

• Futures Activity: Nifty futures closed at 23,261.75, a decline of 0.5%, with an open interest increase of 5.75%, signaling a continuation of the downtrend.

• Sectoral Performance:

  • IT and Banking: Led the decline, reacting to mixed earnings reports.

  • Realty, Metal, and Energy: Outperformed, providing some resilience to the broader market.

• Broader Indices: Despite the weak sentiment in benchmark indices, broader market indices showed marginal gains, highlighting selective buying interest in mid-cap and small-cap stocks.

Market Sentiment: Early weakness was evident as heavyweights in the IT and banking sectors faced selling pressure. Resilience from Reliance Industries, ITC, and Larsen & Toubro (LT) helped limit the overall decline.

Technical Analysis:

• Support Levels: Immediate support for Nifty is seen at 23,100, and a break below this level could intensify the selling pressure.

• Resistance Levels: On the upside, 23,300 remains a critical resistance level. Sustained movement above this level is essential for a potential recovery.

• Volatility: Market volatility persisted, reflecting the cautious investor sentiment amid global and domestic uncertainties.

Outlook: The market continues to grapple with external pressures, including high US bond yields and geopolitical tensions, alongside domestic challenges like muted FII flows and sector-specific earnings concerns. Investors are advised to remain cautious and focus on sectors showing relative strength, such as realty, metal, and energy.

Recommendations for Traders and Investors:

1. Traders: Use a strict stop-loss strategy given the volatile environment. Focus on sectors showing resilience for intraday opportunities.

2. Investors: Adopt a selective approach, concentrating on fundamentally strong stocks in outperforming sectors like energy and realty.

Conclusion: The Nifty’s half-percent decline after three days of gains underscores the prevailing uncertainty. With external and domestic headwinds persisting, the near-term trajectory of the market hinges on further developments in the US bond market, geopolitical stability, and upcoming earnings reports.

Stay tuned for more updates and analysis!

NIFTY OUTLOOK & TRADING TIPS FOR 13 JAN 2025

 Indian Stock Market Report – January 10

Key Indices Performance

• Sensex: Closed at 77,378.91, down 241.30 points or 0.31%.

• Nifty 50: Closed at 23,431.50, down 95 points or 0.40%.

Intraday Highlights

• Sensex:

  • Opened: 77,682.59 (Previous close: 77,620.21).

  • Intraday low: 77,099.55 (-0.70%).

  • Final close: 77,378.91 (-241 points).

• Nifty 50:

  • Opened: 23,551.90 (Previous close: 23,526.50).

  • Intraday low: 23,344.35 (-0.80%).

  • Final close: 23,431.50 (-95 points).

Broader Market Performance

• BSE Midcap Index: Down 2.13%.

• BSE Smallcap Index: Down 2.40%.

Market Trends

1. Sectoral Indices:

   • Gains:

     • Nifty IT: Up 3.44%, buoyed by strong Q3 results from TCS.

   • Losses:

     • Nifty Media: Down 3.59%.

     • Realty: Down 2.77%.

     • PSU Bank: Down 2.72%.

     • Healthcare and Pharma: Down 2.21% and 2.13%, respectively.

     • Consumer Durables, Private Bank, Metal: Lost 1.6%-2.0%.

2. Investor Sentiment:

   • Cautious ahead of December quarter earnings.

   • Continued foreign portfolio investor (FPI) outflows.

3. Market Cap:

   • Decline of nearly ₹12 lakh crore over three sessions.

   • BSE-listed firms' total market cap fell below ₹430 lakh crore (from ₹442 lakh crore on January 7).

Key Factors Impacting the Market

1. Global Cues:

   • Rising US dollar and bond yields.

   • US treasury yields at eight-month highs.

   • Strong US macroeconomic data and reduced prospects of significant US Federal Reserve rate cuts.

2. Domestic Concerns:

   • Indian rupee depreciation against the US dollar.

   • Weakness in Asian markets.

   • Economic growth slowdown: GDP projected at 6.4% for FY24-25 (four-year low).

3. Sectoral Performance:

   • IT: Resilient due to strong Q3 results from TCS.

   • Banking: May face pressure despite anticipated good results due to FPI selling.

4. FPI Activity:

   • Net outflows exceeding ₹19,000 crore till January 9.

Technical Analysis

• Nifty 50:

  • Formed a bearish candle on daily charts, indicating further weakness.

  • Resistance Levels: 24,000-24,150.

  • Support Levels: 23,250 and below.

  • RSI trending lower, indicating weakening momentum.

• Sensex:

  • Resistance: 78,000.

  • Support: 77,200-77,300.

Outlook

1. Short-Term:

   • Market expected to remain volatile with stock-specific actions driven by Q3 earnings.

   • Traders should remain cautious and focus on selective opportunities.

2. Medium-Term:

   • Concerns over high valuations and slowing growth may weigh on the market.

   • Potential headwinds from global and domestic economic uncertainties.

Conclusion

The Indian equity market remains under pressure due to weak global cues, foreign capital outflows, and domestic growth concerns. While the IT sector provides some resilience, broader market trends signal caution for investors in the near term.

NIFTY OUTLOOK & OPTION CALL PUT TIPS FOR 08-01-2025

 The Nifty continues to exhibit indecision as technical indicators present mixed signals. The Relative Strength Index (RSI) at 43 suggests bearish momentum, whereas a bullish crossover on the Stochastic RSI hints at a potential short-term recovery. This divergence highlights the lack of a clear directional bias, calling for heightened vigilance in market participation.

On the daily chart, the index formed an inside bar pattern, closing near the 23,700 level. This indicates a period of consolidation, with the market sentiment remaining cautious.

Key Levels to Watch

• Support: Immediate support is seen at 23,600. A breach of this level could trigger further corrections towards 23,400 and 23,000.
• Resistance: On the upside, resistance is positioned at 23,800, with a critical hurdle at 24,000.

Open Interest Data Insights

• Call OI: The highest open interest is concentrated at the 24,000 and 23,800 strike prices, indicating strong resistance zones.
• Put OI: On the downside, the highest open interest is at the 23,500 strike price, followed by 23,700, which may act as crucial support levels.

NIFTY VIEW FOR 6 JAN 2025

 Market Report: January 3, 2025

Indian benchmark indices ended their two-day winning streak and closed lower on January 3. The Nifty settled near the 24,000 mark, and the Sensex posted a decline as broader markets reflected the cautious sentiment.

Market Summary:

• Sensex: Down 720.60 points (-0.90%) to 79,223.11

• Nifty: Down 183.90 points (-0.76%) to 24,004.75

After a flat opening, the Nifty traded within a narrow range, closing near the day’s low of 24,005. The pullback was largely attributed to a pause following the recent three-day rally, with markets shedding over half a percent.

Sectoral Performance:

• Gainers:

  • Energy

  • FMCG

• Losers:

  • IT (-1%)

  • Pharma (-1%)

  • Banks (-1%)

  • Capital Goods (-1%)

The broader indices mirrored the benchmarks, with the BSE Midcap index down 0.33% and the Smallcap index ending flat.

Market Breadth:

• Advances: 2,048 shares

• Declines: 1,778 shares

• Unchanged: 111 shares

Stock Performance:

• Major Losers:

  • Wipro

  • ICICI Bank

  • HDFC Bank

  • Tech Mahindra

  • Adani Ports

• Major Gainers:

  • ONGC

  • Tata Motors

  • SBI Life Insurance

  • Titan Company

  • HUL

Analysis:

The decline in indices is seen as a healthy correction following a brief recovery. The market's inability to sustain momentum highlights ongoing concerns:

• Pessimism due to:

  • Slowing domestic growth

  • Higher valuations

  • Foreign fund outflows

  • Uncertainty over U.S. trade policies under President Trump’s administration

Outlook:

The Nifty faces resistance at 24,250, and further pullbacks may occur unless this level is decisively breached. Investors are advised to remain stock-specific, focusing on outperforming sectors like FMCG, auto, and energy.

Caution remains the watchword as markets navigate global uncertainties and domestic challenges. However, selective opportunities aligned with sectoral trends may offer favorable returns in the near term.

NIFTY OUTLOOK FOR 31 DECEMBER 2024

 The Indian stock markets witnessed a sharp downturn in late afternoon trading on Monday, with the BSE Sensex and NSE Nifty indices closing significantly lower. Key factors such as foreign institutional investor (FII) outflows, weak global cues, and a depreciating rupee weighed heavily on investor sentiment.

Key Indices Performance

• BSE Sensex: The index closed at 78,248, down 450 points or 0.6% from the previous session’s close. The Sensex fell over 1% from its intraday high.

• NSE Nifty: Nifty ended the session at 23,645, losing 168 points or 0.7%. Like the Sensex, it also slipped more than 1% from its intraday peak.

Market breadth remained weak throughout the session, indicating broad-based selling pressure across sectors.

Sectoral Highlights

• Gainers:

  • Nifty Pharma: Bucked the bearish trend with a 1% gain, driven by strong performances from stocks like Sun Pharma (+1.2%) and Cipla (+1%).

  • Other indices such as Consumer Durable, FMCG, and IT managed to close slightly positive.

• Losers:

  • Nifty Auto: The worst-performing sector, down 1.4%.

  • Nifty Bank: Lost 0.7%, despite leading an intraday recovery earlier.

  • Energy, Infrastructure, and Metals indices also witnessed losses ranging from 0.5% to 1.5%.

Stock Highlights

• Top Gainers:

  • Adani Enterprises: Surged 7.5% to close at ₹2,592, making it the top performer on the Nifty.

  • HCL Tech: Gained 2%.

  • Tech Mahindra: Rose by 1.7%.

• Top Losers:

  • Hindalco: Fell 2.6%.

  • Bharat Electronics, Trent, and Tata Motors: Declined by up to 2.5% each.

Volatility and Currency Impact

• India VIX: The volatility index increased by 5.5% to close at 13.97, reflecting heightened uncertainty.

• Rupee Depreciation: The Indian rupee continued to weaken, nearing the 86-per-dollar mark, reducing the appeal of Indian equities to foreign investors due to lower returns in dollar terms.

Global and Domestic Factors

The persistent FII outflows and global cues contributed to the bearish sentiment. A weakening rupee added to the concerns, making Indian assets less attractive to international investors. Broader global uncertainties and sector-specific headwinds also influenced the day’s trading pattern.

Outlook

With continued FII selling pressure and currency weakness, the near-term outlook for Indian equities remains cautious. Market participants will closely monitor global economic developments and domestic macroeconomic indicators to assess further movement.

Investors are advised to adopt a selective approach, focusing on sectors showing resilience, such as pharmaceuticals, and remain cautious about high-volatility segments like autos and metals.

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NIFTY OUTLOOK FOR 30 DECEMBER 2024

 Daily Market Report: December 27

Key Highlights:

• Sensex: Up 226.59 points (+0.29%) to 78,699.07

• Nifty: Up 63.20 points (+0.27%) to 23,813.40

• Advance/Decline Ratio: 1866 shares advanced, 1946 shares declined, 113 shares unchanged

Market Overview: Indian benchmark indices ended with gains on December 27, driven by strength in Asian equities. Nifty closed above the 23,800 mark, while Sensex advanced to 78,699.07. However, the session saw range-bound action with resistance at the 23,900-24,000 levels, which capped further gains. Profit-taking in the mid-session caused indices to drift lower from their intraday highs.

Technical Analysis:

• A small green candle with an upper shadow formed on the daily chart indicates an attempt to break out of the narrow range but lacked conviction.

• The downside gap from December 19 remains unfilled, signaling potential bearish undertones.

• Resistance Levels: 24,000-24,200

• Support Levels: 23,650

Sectoral Performance:

• Gainers:

  • Nifty Auto Index: +1%, driven by expectations of higher December volumes and favorable valuations.

  • Nifty Pharma & Healthcare: +0.8%, showing strength in defensive sectors.

  • Nifty Bank: +0.3%, supported by select heavyweights.

• Losers:

  • Nifty Metal & PSU Bank: -1% each.

  • Nifty Oil & Gas: -0.7%.

  • Nifty Realty & Consumer Durables: -0.5% each.

Global Markets:

• Asian Markets: Continued their rally, with the MSCI Asia Pacific Index logging its fifth consecutive gain. Tokyo stocks surged due to yen weakness driven by unclear signals from the Bank of Japan.

• European Markets: Stoxx Europe 600 edged up 0.2% in light holiday trading.

• US Markets: Equity futures dipped as markets digested a lackluster session on Wall Street. Treasury yields and the dollar remained stable.

Stock Highlights:

• Gainers:

  • Dr. Reddy's Labs, M&M, IndusInd Bank, Eicher Motors, Bajaj Finance.

• Losers:

  • Hindalco Industries, SBI, ONGC, Coal India, Bharat Electronics.

• Midcap and Smallcap Indices: Midcap index remained flat, while smallcap index rose 0.3%.

Key Observations:

• Consolidation continued as the market remained volatile and lacked conviction.

• Late profit-taking capped gains, especially in sectoral heavyweights.

• Rupee’s record low against the dollar and foreign investors’ cautious stance contributed to uncertainty.

Outlook: The short-term trend for Nifty is slightly positive but remains range-bound. Resistance levels at 24,000-24,200 may provide a sell-on-rise opportunity. Defensive sectors like pharma and healthcare, along with select heavyweight stocks, present promising opportunities. Traders are advised to stay stock-specific and maintain a balanced approach on both sides of the market.

NIFTY OUTLOOK FOR 27 DECEMBER 2024

Market Analysis Report: December 26, 2024

Overview of Market Performance

The Indian benchmark indices concluded on a flat note in a volatile trading session on December 26. The BSE Sensex ended marginally lower by 0.39 points at 78,472, while the NSE Nifty gained 22.55 points, to close at 23,750.

On the final expiry day of the year, the domestic market exhibited a lackluster performance, influenced by holiday closures in global peer markets and the absence of significant domestic or international triggers. Gains in the auto sector, following recent corrections, were counterbalanced by concerns over Foreign Institutional Investor (FII) outflows and a depreciating rupee. These factors were fueled by the strengthening US dollar index and apprehensions about potential adverse tariffs and rate cut concerns for 2025.

Key Observations and Trends

1. Nifty’s Performance:

   • The Nifty index traded within a narrow range of 300 points during the week.

   • The index struggled to break above the 23,870 level while maintaining support near 23,600 over the past three sessions.

   • This tussle between bullish and bearish forces resulted in multiple Doji candles and inside bars on the daily chart, signaling market indecision.

2. Technical Indicators:

   • The Nifty is currently hovering near its 200-day Exponential Moving Average (EMA).

   • It remains below its short-term moving averages, indicating potential bearish sentiment.

   • On the weekly chart, a Doji candle formation suggests support-based buying but points to limited upside potential.

3. FII Activity:

   • Persistent FII selling pressure is evident, with the Long-Short ratio declining to 23%.

   • This trend reflects cautious investor sentiment amidst global and domestic uncertainties.

Market Projections

• Support and Resistance Levels:

  • As long as the Nifty remains above the 23,500 zone, the index may see swings toward the 23,900-24,000 range.

  • Downside support is strong around 23,600, with a broader trading range projected between 23,200 and 24,200.

• Option Data Insights:

  • Maximum Call Open Interest (OI): 24,000 followed by 25,000 strike levels.

  • Maximum Put OI: 23,800 followed by 23,000 strike levels.

  • Call writing: Observed at 23,800 and 24,000 strikes.

  • Put writing: Concentrated at 23,800 and 23,000 strikes.

  This data suggests an immediate trading range of 23,500-23,900, with a broader outlook of 23,200-24,200.

Sectoral Highlights

• Auto Sector: Gained traction following recent corrections, signaling renewed buying interest.

• Currency and Macro Factors: Concerns over a depreciating rupee and strengthening US dollar index remain significant headwinds. Potential adverse tariffs and rate cut uncertainties for 2025 continue to weigh on market sentiment.

Conclusion

The Indian equity market remains in a consolidation phase with no clear directional bias. Key levels for the Nifty index and evolving macroeconomic factors will likely shape short-term market trends. Investors are advised to remain cautious, focusing on technical levels and sector-specific opportunities while keeping a close watch on global cues and FII activity.

Indian Equity Indices End Marginally Lower in a Volatile Session on December 24

The Indian stock market concluded on a subdued note on December 24, with key indices ending slightly lower after a range-bound trading session. The Sensex closed at 78,472.87, down 67.30 points (0.09%), while the Nifty ended at 23,727.65, down 25.80 points (0.11%).

Market Highlights

• Broader Market Performance:
  • Around 1,907 shares advanced, 1,926 shares declined, and 94 shares remained unchanged.
  • Midcaps moved in tandem with the frontline indices, while smallcaps marginally outperformed, gaining 0.3%.
• Sectoral Performance:
  • Top Gainers: Auto, FMCG, and oil & gas sectors saw buying interest, supported by recent corrections.
  • Top Losers: IT, media, metal, and PSU bank sectors faced selling pressure, with notable intraday profit booking in metal and PSU bank stocks.
• Key Stock Movers:
  • Gainers: Tata Motors, Adani Enterprises, Eicher Motors, BPCL, and ITC.
  • Losers: Power Grid Corp, JSW Steel, SBI Life Insurance, Titan Company, and SBI.

Technical Overview

The Nifty remained mostly range-bound, forming a small inside-body candle on the daily chart. The index closed below the 200-day moving average (200-DMA) for the first time in three sessions, confirming a short-term bearish trend.

• Support Levels: 23,500–23,400.
• Resistance Levels: 23,860.
• A breakout above 23,850 could trigger a rally toward 23,950–24,000, while selling pressure below 23,600 might push the index down to 23,500–23,475.

Market Sentiment

• The RSI shows a bearish crossover, reinforcing a cautious outlook.
• The market texture remains non-directional, with traders awaiting a decisive breakout in either direction.

Factors Influencing the Market

• Global and Domestic Concerns:
  • A strong dollar, elevated bond yields, and concerns about rate cuts weigh on sentiment.
  • The Indian rupee hitting an all-time low has also added to the cautious mood.
• Upcoming Catalysts:
  • The trajectory of the market in the near term will depend on Q3 corporate earnings and the Union Budget.

Summary

Despite a positive start driven by gains in the auto and FMCG sectors, the Nifty failed to sustain above 23,850, reversing gains and closing flat. The day’s action highlighted a well-defined range between 23,650–23,850, with a breakout necessary to determine the market’s next direction.

Investors are advised to maintain a cautious stance in the short term while monitoring global cues and upcoming domestic developments.

NIFTY OUTLOOK FOR 23 DEC 2024

 Indian Equity Market Report: December 20

Key Highlights:

1. Market Performance:

   • The Nifty 50 closed at 23,587.50, down 364.2 points (1.52%).

   • The Sensex ended at 78,041.59, losing 1,176.46 points (1.49%).

   • Broader indices experienced sharper declines, with losses ranging from 2.2% to 3%.

2. Global and Domestic Factors:

   • US Federal Reserve's Rate Cut:

     • A 25 basis points rate cut was announced, aligning with expectations. However, the signal of only two rate cuts in 2025 disappointed global markets.

     • Fed Chair Jerome Powell revised the 2025 inflation forecast upward, emphasizing persistent inflation risks.

   • Foreign Institutional Investors (FII) Activity:

     • FIIs net sold Rs 12,230 crore worth of Indian equities over the past four sessions, reversing their earlier buying spree.

     • A strong US dollar and higher US Treasury yields (10-year at ~4.52%) have reduced the appeal of emerging markets like India.

   • Valuation Concerns:

     • The Nifty’s one-year forward P/E stands at nearly 20x, exceeding its 10-year historical average of 18.97x, leaving little margin of safety.

3. Sectoral Analysis:

   • Realty, IT, and Auto Sectors:

     • These sectors faced the steepest declines due to selling pressure.

     • IT stocks, which previously outperformed on anticipation of rate cuts, were notably impacted by the Fed’s hawkish stance.

   • Mid- and Small-Cap Stocks:

     • Valuations at historical peaks led to significant underperformance, with these indices falling sharply.

4. Technical Analysis:

   • The Nifty breached its 200-day exponential moving average (200 DEMA) at 23,870 on Thursday, intensifying selling pressure.

   • Friday’s session saw the index dip below critical support levels at 23,850, exposing further downside toward the 23,700–23,500 range.

   • Resistance for recovery lies between 23,850 and 24,000.

5. Key Challenges Ahead:

   • Persistent Selling Pressure:

     • Concerns over high valuations and sluggish earnings growth continue to weigh heavily on investor sentiment.

   • Global Uncertainty:

     • Apprehensions about upcoming trade policies under the incoming US administration and their potential global market impact.

   • Dollar Strength:

     • The rupee’s weakness against the dollar is prompting FIIs to shift investments to safer dollar assets.

6. Outlook:

   • The November low of 23,250 emerges as a crucial support level.

   • Traders are advised to maintain a cautious stance and prioritize risk management.

   • Upcoming Q3 FY25 corporate earnings may provide some clarity but are unlikely to spur immediate recovery given broader market conditions.

Conclusion: The Indian equity markets remain under pressure due to a confluence of global and domestic factors, including hawkish signals from the US Fed, FII outflows, high valuations, and sluggish earnings growth. Breaching key technical levels has intensified bearish sentiment, and the market’s ability to sustain critical support levels will determine its near-term trajectory.

NIFTY PREDICTION FOR 16 DEC 2024

Market Overview On December 13, Indian equity indices closed on a strong note with the Nifty surging above 24,750. The Sensex gained 843.16 points (1.04%) to close at 82,133.12, while the Nifty added 219.60 points (0.89%) to end at 24,768.30.

The trading session was characterized by significant volatility, with the Nifty experiencing sharp swings in both directions before closing near the day’s high. Despite a weak opening, markets recovered, supported by value buying in banking, IT, and telecom sectors amid improving macroeconomic indicators.

Technical Analysis

• Daily Chart: Nifty tested its 20-day moving average (24,200) and rebounded sharply. The index’s strong close near the day’s high indicates the potential for further upside.

• Weekly Chart: The Nifty formed an Inside Bar candlestick pattern, making the extremes of the previous candle (24,858 – 24,009) crucial levels to watch for the upcoming week.

• Key Levels:

  • Resistance: Immediate resistance is expected at 24,800, with potential upside targets at 25,125 and higher.

  • Support: Key support levels are positioned at 24,550 and 24,400.

Derivative Data

• Short Covering: Significant short covering was observed at the 24,600 CE.

• Put Writing: Strong put writing occurred at 24,500 and 24,400 strikes.

• PCR: The Nifty Weekly Put-Call Ratio (PCR) improved from 0.70 to 1.04, signaling bullish sentiment.

Sectoral Highlights

• Gainers:

  • FMCG, IT, Banking, Telecom: These sectors led the gains, rising 0.5% to 2%. The FMCG sector outperformed due to easing food inflation, festive demand, and price hikes by companies.

  • Top Gainers: Bharti Airtel, Kotak Mahindra Bank, ITC, UltraTech Cement, and HUL.

• Losers:

  • Realty, Metal, Media: These sectors declined by 0.5% each.

  • Top Losers: Shriram Finance, IndusInd Bank, Tata Steel, Hindalco, and JSW Steel.

• Broader Indices: Both the BSE Midcap and Smallcap indices ended on a flat note.

Market Drivers

1. Improving Macroeconomic Indicators:

   • Moderation in food inflation.

   • Uptick in Index of Industrial Production (IIP) growth numbers.

2. Value Buying: Investors showed interest in beaten-down sectors like banking, IT, and telecom.

3. Consumer Spending Outlook: Anticipation of higher spending during the festive season and year-end holidays boosted market sentiment.

Brookfield India REIT Capital Raise Brookfield India Real Estate Trust raised ₹3,500 crore through a Qualified Institutional Placement (QIP) to reduce debt. This marked the first REIT investment in India by the International Finance Corporation (World Bank Group) and Life Insurance Corporation of India. The issue attracted strong demand from institutions, mutual funds, and insurance companies.

Outlook for the Upcoming Week The Nifty’s strong finish near the day’s high and improving derivative data suggest positive momentum is likely to persist. A breakout above 24,800 could pave the way for a move toward 25,125 and beyond. On the downside, support at 24,400 and 24,550 will be crucial. Participants are advised to:

• Focus on IT and banking sectors.

• Employ robust risk management strategies to navigate market volatility effectively.

Conclusion Indian equities demonstrated resilience by rebounding from a weak start and closing on a positive note. With supportive macroeconomic data, sectoral strength in FMCG, IT, and banking, and bullish technical patterns, the markets appear poised for further gains in the short term.

NIFTY OUTLOOK FOR 7 DEC 2024

Overview: The Indian equity market witnessed a volatile trading session on December 6, closing marginally lower despite mixed sentiment. The Sensex declined by 56.74 points (0.07%) to close at 81,709.12, while the Nifty dropped by 30.60 points (0.12%) to end at 24,677.80. Midcap and smallcap indices continued their strong performance, gaining 0.3% and 0.6% respectively, reflecting optimism in broader markets.

Key Highlights:

• Market Sentiment: A narrow trading range dominated the session as the Reserve Bank of India’s (RBI) monetary policy announcements aligned with market expectations, offering no major surprises.
• Sector Performance: Gains were observed in auto, metal, FMCG, telecom, and PSU Bank sectors (up 0.3%-1%). However, IT and media sectors ended in the red.
• Stock Movers:
  • Top Gainers: Bajaj Auto, Axis Bank, SBI Life, Tata Motors, Maruti Suzuki.
  • Top Losers: Adani Ports, Cipla, Bharti Airtel, HDFC Life, Asian Paints.
• Market Breadth: Approximately 2298 shares advanced, 1529 declined, and 98 remained unchanged, reflecting a positive breadth in broader indices.

RBI Monetary Policy Insights:

• The RBI maintained the repo rate at 6.5%, citing persistent core inflation above tolerance levels.
• The Cash Reserve Ratio (CRR) was reduced from 4.5% to 4%, injecting ₹1.16 lakh crore into the financial system to support growth.
• Projections for FY25 GDP growth were revised downward to 6.6% (from 7.2%), while inflation forecasts were adjusted to 4.8% (from 4.5%).

Market Analysis:

• The Nifty sustains above the inverse head-and-shoulders breakout, suggesting a strong technical setup. A buy-on-dips strategy is recommended to capitalize on potential upward momentum, with a target of 25,500 in the short term.
• Despite the broader market optimism, minor pullbacks may follow recent rallies, emphasizing selective stock picking across resilient sectors like auto, metal, and midcaps.

Currency Market:

• The Indian Rupee appreciated due to:
  • RBI’s unchanged repo rate decision.
  • Decline in US Dollar and crude oil prices.
• The Rupee faced pressure due to the downward revision of GDP growth and inflation projections for FY25, coupled with demand for the US Dollar.
• USDINR Outlook: Expected to trade between ₹84.45 and ₹84.95. Weakness in crude oil and FII inflows may support the Rupee.

Conclusion: The Indian equity market is showcasing a cautious yet optimistic outlook amid sector rotation and mixed macroeconomic signals. While benchmark indices remained flat, broader indices displayed strength, particularly in midcap and smallcap stocks. Investors are advised to adopt a selective approach with a buy-on-dips strategy, focusing on sectors with robust growth potential.

Further cues will be shaped by global economic data, including the US non-farm payrolls report, which could influence market sentiment in the coming sessions.

NIFTY OUTLOOK FOR 5 DEC 2024

 Market Report – December 4, 2024

The Indian equity markets extended their gains for the fourth consecutive session on December 4, driven by strength in banking and realty stocks. Despite intraday volatility and mixed global cues, the markets maintained a positive trajectory, signaling resilience ahead of the Reserve Bank of India’s (RBI) monetary policy announcement.

Key Indices Performance

• Sensex: Gained 110.58 points (+0.14%) to close at 80,956.33.
• Nifty 50: Rose by 10.30 points (+0.04%) to end at 24,467.45.

Market Highlights

1. Nifty Overview:

   • The Nifty remained choppy throughout the session, reflecting caution among investors.
   • Immediate resistance is seen at 24,660, with 24,350 acting as a crucial support level.

2. Sectoral Performance:

   • Top Gainers: PSU Banks (+2.1%) and Realty (+2.3%) sectors led the rally.
   • Underperformers: FMCG (-0.7%) and Auto (-0.7%) sectors faced pressure.
   • IT & Media: Moderate gains of 0.5% each.

3. Broader Markets:

   • Midcap Index: Advanced by 1.05%.
   • Smallcap Index: Rose 0.89%.

4. Top Gainers & Losers:

   • Gainers: HDFC Life, HDFC Bank, Apollo Hospitals, NTPC, and Bajaj Finserv.
   • Losers: Bharti Airtel, Cipla, Bajaj Auto, Tata Motors, and Adani Ports.

Technical Insights

• A Spinning Top candlestick pattern on the charts highlights indecision among market participants.
• Broader market sentiment remains positive, suggesting any dip may be seen as a buying opportunity.
• Immediate Levels:
  • Resistance: 24,660 to 24,700.
  • Support: 24,350.

Factors Influencing the Market

1. Domestic Momentum:

   • Strength in PSU Banks and Realty sectors.
   • Continued confidence in broader markets, as evidenced by midcap and smallcap gains.

2. Global Sentiments:

   • Mixed cues from Asian markets due to geopolitical concerns in South Korea.
   • Anticipation of the Federal Reserve Chair's upcoming speech, as recent FED minutes indicate easing inflation.

3. Macroeconomic Expectations:

   • Caution ahead of the RBI policy announcement.
   • Speculation on the continuation of the US rate-easing cycle, which could impact foreign inflows.

Outlook for December 5, 2024

• The market is expected to consolidate after recent gains, with a focus on stock-specific movements.
• Positive sentiment is likely to persist, but traders should remain cautious of resistance at higher levels.
• Sectors like banking and financials may continue to drive momentum, while profit-booking could limit the upside.

Advice for Traders

• Adopt a stock-specific approach and accumulate quality stocks during dips.
• Monitor key levels of 24,660 and 24,350 for directional cues.
• Keep an eye on global events, including US Federal Reserve updates and geopolitical developments, for potential market impacts.

NIFTY OUTLOOK & TRADING TIPS FOR 4 DEC 2024

Indian equity markets extended their gains for the third consecutive session on December 3, 2024, driven by positive global sentiment, robust buying in banking, and media stocks, while selective profit booking was observed in defensive sectors.

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Market Overview

• Sensex:

  • Closed at 80,845.75, up 597.67 points (+0.74%).

• Nifty:

  • Closed at 24,457.15, up 181.10 points (+0.75%).

• Advance-Decline Ratio:

  • Advancers: 2,647, Decliners: 1,190, Unchanged: 99

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Sectoral Performance

• Top Performing Sectors:

  • PSU Banks (+2%)
  • Media (+2%)

• Subdued Sectors:

  • FMCG and Pharma experienced intraday profit booking.

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Top Gainers and Losers (Nifty 50)

Top Gainers:

1. Adani Ports
2. NTPC
3. Adani Enterprises
4. Axis Bank
5. SBI

Top Losers:

1. Bharti Airtel
2. ITC
3. Hero MotoCorp
4. HDFC Life
5. Sun Pharma

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Technical Highlights

• Nifty closed above the critical resistance level of 24,350, signaling further upside potential.

• Formation of a bullish candle on daily charts along with a higher bottom pattern indicates positive sentiment.

• Key Levels:

  • Support: 24,350 / 24,250
  • Resistance: 24,600 / 24,700

• The breakout from an Inverted Head and Shoulders pattern confirms a trend reversal, with a projected target of 25,440.

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Trading Strategy

• For Bulls:
  • Adopt a "buy on dips" approach as long as indices trade above 24,350.
• For Bears:
  • Watch for a break below 24,350, which could trigger correction toward 24,150.

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Currency Update

• The Indian Rupee touched a record low early in the session due to strong USD momentum and economic slowdown concerns. However, RBI intervention and strong equity performance led to recovery.
• USD/INR Range: 84.45 - 84.90

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Outlook

• Sustained momentum could push Nifty towards 24,700 in the near term.
• Midcap and smallcap indices are likely to outperform, supported by renewed investor confidence.
• Continued focus on RBI policies, global cues, and corporate earnings will drive market direction.

Investor Focus Areas:

• Banking (especially PSU) and IT sectors hold potential for further upside.
• Cautious approach recommended for FMCG and Pharma.

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This strong start to December showcases resilience amidst global uncertainties, hinting at optimism for year-end performance.

NIFTY OUTLOOK FOR 3 DEC 2024

Key Highlights:

• Sensex closed at 80,248.08, up 445.29 points or 0.59%.
• Nifty ended at 24,276, up 144.90 points or 0.60%.
• Sectoral Performance:
  • Realty, Pharma, Metal, Auto, and Media sectors gained over 1%.
  • Broader indices outperformed, with BSE Midcap and Smallcap indices rising nearly 1% each.
  • PSU Banks and FMCG underperformed.

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Index Insights:

1. Nifty:

   • Resistance: Immediate resistance is at 24,350, a key neckline of the Inverted Head & Shoulder formation. A breakout above this level could push the index towards 24,770.
   • Support: Crucial support levels are at 24,100 and 24,000.
   • Momentum: The bullish harami pattern and a green candle on the daily chart indicate sustained positive momentum. The RSI has also broken out of consolidation and is in a bullish crossover.

2. Bank Nifty:

   • Recovered 500 points from intraday lows to close 53 points higher.
   • Resistance: Expected upward momentum towards 52,800–53,000.
   • Support: Short-term critical levels are at 51,700–51,500.

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Sectoral Performance:

• Top Gainers: Realty, Pharma, and Metal sectors led the rally, with heavyweights from these sectors providing significant support.
• Mixed Performance: Auto and IT sectors remained resilient, while PSU Banks and FMCG witnessed subdued activity.
• Midcap and Smallcap: Continued their strong performance, outpacing the benchmarks and contributing to the market breadth.

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Stock Movement:

• Top Gainers:
  • UltraTech Cement
  • Apollo Hospitals
  • Grasim Industries
  • JSW Steel
  • Shriram Finance
• Top Losers:
  • HDFC Life
  • Cipla
  • NTPC
  • SBI Life Insurance
  • L&T

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Market Sentiment:

• Positive Indicators:
  • Recovery in October’s core sector output.
  • Hopes of supportive RBI measures ahead of its policy meeting.
  • Strong performance across Realty and Metal sectors.
• Cautionary Notes:
  • Disappointing GDP data for Q2 weighed on sentiment initially.
  • Anticipation of a cut in GDP forecast and cautious stance on rate cuts due to unfavorable inflation dynamics.

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Technical Outlook:

• Nifty Outlook:
  • Closing above the 40-day moving average of 24,300 signals potential for continued uptrend.
  • Immediate hurdle at 24,420; surpassing this could trigger a rally towards 24,770.
• Bank Nifty Outlook:
  • Momentum indicators align positively, with room for gains towards 52,800 and 53,000.

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Conclusion:

Markets started the week on a strong footing, defying weak macroeconomic signals with a recovery driven by select heavyweights. The broad-based rally, led by Realty and Pharma, indicates resilience and potential for further gains. However, the upcoming RBI policy announcement and macroeconomic uncertainties may keep investor sentiment cautious. A selective approach with a focus on fundamentally strong stocks is advised.

NIFTY OUTLOOK FOR MONDAY 2 DEC 2024

 The Indian equity market rebounded strongly on November 29, 2024, erasing some of the previous session's losses. Both Sensex and Nifty indices closed on a high note, bolstered by gains in key sectors like pharma, energy, and auto.

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Key Highlights:

• Sensex and Nifty Performance:

  • Sensex: Gained 759.05 points (+0.96%), closing at 79,802.79.
  • Nifty 50: Rose by 216.90 points (+0.91%), settling at 24,131.10.

• Market Breadth:

  • Advancing stocks: 2241
  • Declining stocks: 1564
  • Unchanged: 88

• Volatility Index:

  • India VIX cooled off by 5.12% to 14.43, signaling reduced market volatility.

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Sectoral Performance:

• Top Gainers:

  • Auto, Energy, Pharma, Media: Advanced by 1-2%, leading the day's rally.
  • Key performers: Bharti Airtel, Cipla, Sun Pharma, M&M, Adani Ports.

• Underperformers:

  • Realty and PSU Bank indices closed in the red.
  • Notable laggards: Power Grid Corp, Shriram Finance, Hero MotoCorp, Nestle, Apollo Hospitals.

• Indices Movement:

  • BSE Midcap Index: Up 0.3%.
  • Smallcap Index: Increased by 0.7%.

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Technical Analysis:

Nifty 50:

• Reclaimed the 21-Day Exponential Moving Average (DEMA), indicating strength.
• Formed a green candle on the daily chart, showing potential for further upward momentum.
• Resistance Levels: 24,350–24,360.
• Support Levels:
  • Immediate: 24,080 (21-DEMA).
  • Critical: 23,570 (200-DEMA).

Bank Nifty:

• Closed at 52,056 after initial volatility, consolidating in a narrow range.
• Resistance Levels: 52,500–52,600.
• Support Levels: 51,540 (21-DEMA).
• Technical Indicators: Formation of an inside bar on the daily chart and a doji candle on the weekly scale point to market uncertainty.

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Sectoral Insights:

• Pharma & Healthcare:
  Renewed growth due to strong earnings and moderated valuations.

• Energy & Auto:
  Continued strength amid robust demand, benefiting from the festive season.

• IT and Banking:
  Rebounded from recent declines and remain key to determining the broader market direction.

• Smallcaps and Midcaps:
  Smallcaps showed strong relative performance (+0.7%), while midcaps ended flat (+0.3%).

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Global Sentiment:

• Global market sentiment remained muted due to the yen's appreciation and persistent inflation in Japan.

• Domestic markets reflected confidence as Q2 GDP slowdown to 6.5% was already priced into corporate earnings.

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Investor Strategy:

• Stock Selection: Focus on large-cap stability and selective smallcap opportunities with strong performance.
• Profit Booking: Traders are advised to book profits near resistance levels and await fresh breakouts, particularly in the Nifty above 24,360 and Bank Nifty above 52,600.
• Sectoral Focus: Pharma, auto, and energy sectors remain attractive for short-term gains. IT and banking performance should be monitored closely.

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Conclusion:

The broad-based rally, driven by large-cap stocks, signifies resilience in the Indian equity market. With reduced volatility and sectoral strength, investors are advised to adopt a balanced approach, leveraging opportunities in both defensive and cyclical sectors while being cautious at resistance levels.

Stock Market Outlook Report: Bull, Base, and Bear Scenarios for Nifty 50

Summary of Nifty Targets:

• Bull Case: 28,575
• Base Case: 25,977
• Bear Case: 23,379

InCred Equities adopts a cautious stance on the Nifty's trajectory due to delayed RBI rate cuts and elevated expectations around earnings recovery. Political stability, especially with BJP's strong performance in Maharashtra's assembly elections, is expected to reinvigorate government capital expenditure plans.

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Key Market Insights:

Valuation and EPS Analysis

• Forward P/E: Dropped below the 10-year mean, signaling a valuation correction.
• Nifty EPS Trends: 2QFY25 EPS rose 8% YoY but remained flat QoQ. Nifty Bloomberg consensus EPS saw a 3-4% cut for FY25-FY26, with Nifty-200 seeing a milder 2% reduction.

Sectoral Upgrades & Downgrades:

• Upgrades:
  • Pharmaceuticals (Cipla, Ipca Laboratories, Alkem Laboratories)
  • Utilities
• Downgrades:
  • Commodities
  • FMCG
  • Capital Goods

Economic and Market Trends:

• Economic Activity: Seasonal upticks in October-November due to festivals, but broader macroeconomic indicators (electricity consumption, IIP, PMI, loan growth) reflect cyclical slowdowns.
• Rupee and FPI Trends:
  • Significant rupee depreciation against the dollar in November 2024.
  • FPI Outflows: $3.2 billion (1-15 Nov 2024), following $11.4 billion in October.

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High-Conviction Investment Ideas:

Stock Picks with Potential Upside (Up to 94%):

1. Bajaj Finance Ltd
2. Bharat Forge Ltd
3. HDFC Bank Ltd
4. Lupin
5. Tata Steel Ltd
6. Hero MotoCorp
7. Cipla
8. State Bank of India (SBI)

Other Notable Picks:

• TCS (Tata Consultancy Services)
• InterGlobe Aviation
• Maruti Suzuki India
• Cyient DLM
• Petronet LNG
• SBI Card

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Short-Term Strategies and Pair Trades:

To capitalize on a sideways market, the following pair trade ideas were introduced:

• Pidilite Industries vs. Asian Paints
• GAIL vs. Indraprastha Gas (IGL)
• Bajaj Finance vs. Cholamandalam Finance
• ABSL AMC vs. HDFC AMC

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Economic & Fiscal Outlook:

• Capex Targets: The government needs to spend ₹1.2 lakh crore to meet FY25 budgeted targets. However, spending over ₹1 lakh crore per month seems ambitious.
• Macroeconomic Concerns:
  • RBI’s monetary tightening dampens short-term growth.
  • Gradual rural recovery while urban markets slow down.

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Conclusion and Recommendations:

• The Nifty correction phase is expected to persist as macroeconomic challenges hinder EPS momentum.
• Portfolio adjustments favor large-caps and defensive sectors like pharmaceuticals.
• Active pair trade strategies can provide returns amidst market volatility.

InCred Equities emphasizes maintaining a diversified portfolio while focusing on sectors with resilient earnings growth.

STOCK TO WATCH/TRADE ON 27 NOV 2024

LTF

BERGEPAINT

MARICO

BOSCHLTO

COFORGE

HINDCOPPER

BAJAJFIN

LUPIN

UPL

CUB