Weekly Market Wrap: Strong GDP and declining crude propelled Nifty to recapture mount 20K. What lies ahead?

Mumbai: Bull run in Dalal Street’s extended to the fifth straight week. Amid positive global macros and declining crude Indian equity benchmarks ended the holiday-shortened week with a gain of over 2 percentage points supported by better-than-expected GDP numbers and exit poll results.

These signals led the BSE Sensex to surge 1,511 points, or 2.29 per cent, at 67,481 during the week ended on December 1, while the Nifty jumped 473 points, or 2.39 per cent, to 20,268.

Sector-wise, the BSE Oil & Gas index surged the most (5.8 per cent) during the week gone by. While BSE Power and BSE Capital Goods indices have registered a gain of 5.7 per cent, and 3.7 per cent, respectively. Additionally, all major sectoral indices in BSE ended in green with decent weekly gains.

As many as 46 stocks in the Nifty 50 index delivered a positive return for investors in the week. With a weekly gain of 9.5 per cent, Axis Bank emerged as the top gainer in the index.

It was followed by Britannia Industries (7.0 per cent), Bharat Petroleum Corporation (6.7 per cent), Hero MotoCorp (6.1 per cent), and NTPC (6.0 per cent). Ultratech Cement, and Shree Cement also advanced by over five per cent.

On the other hand, IndusInd Bank, Power Grid Corporation of India and Reliance Industries declined 1.0 per cent, 0.3 per cent, and 0.1 per cent, respectively. 

Market Wrap       

Vinod Nair, Head of Research at Geojit Financial Services said, the market soared to new heights this week, decisively breaching the key resistance level and closing strongly above 20,000 levels. Global markets witnessed a bullish trend, buoyed by expectations that the ECB has concluded its rate-hiking cycle amid a backdrop of easing inflation.

“The Indian economy received a substantial boost from strong Q2FY24 GDP figures and a notable surge in manufacturing activity, significantly enhancing the growth outlook. The IPO market maintained its vibrancy, highlighted by Tata Technology’s monumental listing, fostering increased investor confidence in riskier assets,” Nair said.   

He added that the broader market outperformed, with mid and small-caps displaying resilience and no signs of fatigue. Investors remain optimistic about government spending and heightened consumption, driven by easing inflation, propelling growth in H2FY24. Oil prices continued to move on the downside despite the OPEC+ supply cut.

The eagerly awaited exit polls also contributed positively, boosting investor sentiments towards the current union government. 

What to expect next week: “In the upcoming week, investors’ attention will mostly be directed toward the release of service PMI data from the U.S., India, and China. RBI policy meeting next week; anticipate the status quo; however, the growth outlook might be positively tweaked. The gradual return of FIIs in November signals positive momentum to continue.”, Nair said.     

Technical Outlook 

Rupak De, Senior Technical analyst at LKP Securities said that The Nifty continues to ascend as the bulls maintain control. A consolidation breakout on the weekly time frame seems probable, paving the way for a further rally in the index. “The sentiment remains upbeat, marked by a bullish crossover in the weekly RSI. At the lower end, support stands firm at 20,200; any declines could be seen as buying opportunities as long as it hold above this level. On the higher end, resistance is anticipated around 20,450-20,500”, De said.   

Published by : Business Today