Weekly Wrap-Up (DEC 18 – DEC 22, 2023)

The Indian equity markets, after a seven-week upward trend, concluded the week ending December 22 with a 0.5% dip. Despite reaching new record highs during the week, market performance was influenced by mixed global signals and concerns about the increasing number of COVID-19 cases in India.

Indices Weekly Performance

During the week, the BSE Sensex lost 0.53%, closing at 71,106, while the Nifty50 dropped 0.50%, concluding at 21,349. On December 20, both the Sensex and Nifty achieved new milestones, reaching 71,913.07 and 21,593, respectively.

Indices Analysis

NIFTY 50

During the last week, Nifty tested the 21,500-21,600 mark from where we witnessed some profit booking as the RSI readings were quite overbought post the recent run-up. The momentum oscillator is hinting at a probable short-term corrective phase, but since the important supports are intact so far, it may be a time-wise corrective phase. The 20 DEMA at the 20,850-20,900 zone will be seen as important support, which if broken then only one should expect a price-wise retracement phase. Till this support is intact, 20,850-21,500 will be the broad trading range for the Nifty.

BANK NIFTY

The Bank Nifty, however, failed to perform in line with benchmarks as the index fell 348 points to 47,492 and formed a bearish candlestick pattern on the daily scale but still seems to be in the range of 47,000-48,000 area. On the weekly charts, the index has formed a bearish candlestick pattern with a long lower shadow but still held its previous week’s low. The index was down 1.35 percent during the week.

“The Bank Nifty index managed to hold the key support level of 47,400. If the index fails to sustain above this support, it could witness further decline towards the 47,100 levels

Nifty Chart

Nifty exhibited resilience by holding onto the crucial 21,000 mark following a sharp one-day decline and this level is now perceived as a strong support. The 20-day Simple Moving Average (SMA) is hovering around the 20,830 level providing additional support. On the higher side, if it breaks 21,600, Nifty might attempt to test new highs around the 21,750-21,800 zone. The Relative Strength Index (RSI) adds another layer of insight ass it’s consistently maintaining levels above 70.

TOP Gainers & Losers

Adani Green Energy rose 4% on news of its parent group’s $1 billion investment, supporting the company’s ambitious green targets amid upcoming bond maturity. The goal is 45 GW of green energy by 2030, with potential preferential share issuance to founders. CMP: Rs. 1533.10.

GMR Airports Infra Ltd. gained 2% on December 22 after announcing a deal with NIIF to develop Bhogapuram International Airport. NIIF will invest up to Rs. 6.75 billion in GMR Visakhapatnam International Airport Ltd. (GVIAL). CMP: Rs. 74.65.

LIC shares surged 4% to a 52-week high on December 22 as the government granted a one-time exemption, allowing LIC to achieve the 25% minimum public shareholding within 10 years. This removes a stock overhang as the previous deadline was May 2027, requiring government share sales. LIC’s current CMP is Rs. 792.80, and the government holds a 96.5% stake.

SBI Card stock rose nearly 1% during the festive season on a 40% YoY increase in credit card spends to Rs. 1.6 lakh crore in November. SBI Cards outperformed with a 50% YoY spend rise, hitting Rs. 31,400 crore. CMP: Rs. 773.15.

AstraZeneca Pharma shares rose over 12.5% to a 52-week high on December 22 after announcing the launch of Trastuzumab Deruxtecan (Enhertu) for HER2-positive breast cancer treatment in January 2024. CMP: Rs. 5329.10.

Allcargo Gati Ltd. (ACLGATI) shares closed 12.5% lower on December 22 following the demerger announcement by Allcargo Logistics. The direct shareholding aims to simplify the corporate structure. Shareholders of Allcargo Gati will receive 63 shares in demerged Allcargo Logistics for every 10 shares held. Allcargo Logistics, which acquired GATI in 2000 for Rs. 416 crore, ended 8% higher than the previous close. CMP: Rs. 120.80.

V-Guard Industries shares surged over 2% on December 22 following a Rs. 100 crore block deal, with 35 lakh shares changing hands at a floor price of Rs. 286 apiece, a slight discount from the previous session’s closing price of Rs. 287.15. CMP: Rs. 293.20.

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INDIA VIX

The rise of 4.42 points in India VIX to 13.70 suggests an increase in market volatility.

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Sectoral Performance

Among sectors, Nifty PSU Bank index plunged 3.80 percent, Nifty Media index down 1.91 percent, Nifty Auto index down 1.44 percent, and Nifty Metal index shed 1.07 percent. On the other hand, Nifty FMCG up by 1.69, and Pharma indices added 1.33 percent each.

FII & DII Weekly Activity

Foreign institutional investors (FIIs) turned net sellers in this week, as they sold equities worth of Rs 6,422.24 crore, while Domestic institutional investors (DIIs) bought equities worth Rs 9,093.99 crore. However, in the month of December so far, FIIs bought equities worth Rs 23,310.82 crore, while DIIs purchased equities worth Rs 12,276.19 crore.

Global Market

GIFT Nifty :- Gift Nifty has closed with a loss of -155 pts

Dow Jones :- DJI has closed with a gains 80 pts

Nasdaq :- Nasdaq has has closed with gains 153.96 pts

S&P 500:- SPX has closed with a gains of 35.46 pts

Overall globals have end in a net gain forming a positive market this week
In the meantime Gift Nifty is getting drag dow due to Indian Indices.

Currency Indices

Indian rupee ended lower versus US dollar, to finish at 83.09 in the week ended December 22 against December 15 closing of 83.97

Poll of the week

Last week’s poll:

Q) Which of the following companies is more likely to give dividends?

a) Rapidly expanding company

b) Company not expanding as rapidly

Last week’s poll answer: b) Company not expanding as rapidly

Commodity Market

Over the past nine trading sessions, crude oil has exhibited an uptrend momentum. In the previous week, crude oil formed a small-bodied bullish candle and closed 3.66% positive. Crude oil prices are being pressured by Angola’s decision to leave the Organization of the Petroleum Exporting Countries (OPEC). The price weakness stems from concerns about how Angola’s departure may affect OPEC’s unity.The current R1 is placed at 6300, and S1 is placed at 6000.

Gold showed a bullish candle and closed 1.12% positive. At nearly three weeks’ high, as bets on early Federal Reserve interest rate cuts led to lower dollar and bond yields ahead of eagerly anticipated U.S. inflation data. Current R1 is placed at 62,974, and S1 is placed at 62,010

Blogs of the week

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Did you Know? Understanding Stock Prices through House Bidding

Have you ever wondered how the price of a stock is determined and why it fluctuates? Let’s delve into this financial mystery using a real-life analogy: bidding for a house.

Imagine a house for sale with an initial asking price of Rs 1 cr. Bidding commences, and participants start making offers. One bidder goes for Rs 1.1 cr, another raises the stakes to Rs 1.2 cr, and eventually, the house is sold for Rs 1.2 cr.

Now, consider a different scenario with another house priced at Rs 1 cr, but this time it’s more desirable. Bidding ensues again, and the offers escalate: Rs 1.1 cr, Rs 1.3 cr, Rs 1.5 cr, and a final bid of Rs 1.8 cr secures the sale.

This bidding process mirrors the dynamics of the stock market. If there are more buyers than sellers for a particular stock, its price will ascend. The extent of this increase depends on the buyers themselves. If they’re willing to pay even higher prices, the stock’s value will surge even further.

Conversely, when there are more sellers than buyers, the share price takes a dip. Just as in the housing analogy, the degree of decrease is influenced by how much lower the sellers are willing to go.

So, the next time you ponder the rise or fall of a stock, think of it as a virtual bidding war where market participants determine the outcome based on their willingness to pay or accept a certain price.

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