NIFTY WEEKLY OUTLOOK & REPORT FOR 18 JUN 2024

Overview

Indian benchmark indices concluded positively on June 14, with the Nifty index achieving a new record high. The Sensex increased by 181 points or 0.24%, closing at 76,992, and the Nifty rose by 67 points or 0.29%, settling at 23,466. The market demonstrated a consolidation bias, maintaining a range-bound movement throughout the day after an initial dip.

Market Performance

• Sensex: Up 181 points (0.24%) at 76,992
• Nifty: Up 67 points (0.29%) at 23,466
• Advance-Decline Ratio: 2,177 shares advanced, 1,598 shares declined, and 106 shares remained unchanged.
• Rupee: Ended flat at 83.56 per dollar.

Sectoral Performance

• Gainers:
  • Auto
  • Realty
  • Metal
  • Telecom
  • Capital Goods
  • Healthcare
  • Oil & Gas
  • Power
• Laggers:
  • Information Technology (down 0.7%)

Key Gainers and Losers

• Top Gainers on Nifty:
  • Eicher Motors
  • Mahindra & Mahindra (M&M)
  • Adani Ports
  • Shriram Finance
  • Titan Company
• Top Losers on Nifty:
  • Tata Consultancy Services (TCS)
  • Tech Mahindra
  • HCL Technologies
  • Wipro
  • Nestle

Broader Market Indices

• BSE Midcap: Up 1%
• BSE Smallcap: Up 1%
• Midcap Index:
  • 7% rise in two weeks, marking the biggest gain in nearly three years.
  • Nearly 4% gain this week.

Technical Analysis

• Nifty:
  • Consolidating in the range of 23,200 – 23,500 for five consecutive days.
  • A breakout above 23,600 could trigger an uptrend towards 24,000.
  • Positive momentum indicator crossover suggests potential for an upward move.
• Bank Nifty:
  • Facing resistance at the 78.6% Fibonacci retracement level (50,050).
  • Needs to surpass 50,200 for confirmation of an upside breakout towards 51,000.
  • Support levels: 49,500-49,400 zone.

Trading Strategy

• Nifty:
  • Use dips around 23,100-23,300 to initiate fresh positional longs.
  • A decisive close above 23,600 is crucial for the next leg towards 24,000.
• Bank Nifty:
  • Buy interest on dips towards 49,500-49,400 for a target of 50,500 – 50,600.
  • Watch for a break below 49,400, which may indicate further downside risk.

Market Sentiment

• Market gains have extended for the second straight week, with the Nifty up over 4% in two weeks.
• Sensex and Nifty have recorded their biggest two-week gains since December 2023.
• The Bank Nifty has shown moderate growth, up 0.3% for the week.
• Renewed buying interest in midcap and smallcap stocks suggests investor confidence, despite higher valuation concerns in large-cap stocks.
• Anticipation is building ahead of the upcoming government budget, which may introduce intra-day volatility in the markets.

Conclusion

The Indian markets ended the week on a strong note with significant gains in the Nifty and Sensex. The consolidation phase observed in the Nifty index indicates a potential breakout, while sectoral movements and broader market indices suggest a bullish undertone. Investors are advised to focus on a stock-specific approach and use dips for long positions, keeping an eye on key support and resistance levels. The upcoming budget and market expectations may drive short-term volatility, presenting both opportunities and risks.