How are the Markets Looking ?
The Indian stock market witnessed a significant surge on December 4th, with the Nifty index making a remarkable 2% upward move in a single trading day. This surge broke through the crucial resistance level of 20,200, which the Nifty had been struggling to surpass in the previous session. The market’s bullish momentum was further bolstered by a substantial gap-up opening and a close near the day’s high. This exceptional performance showcases the current strength and positivity in the market, largely influenced by the recent by-elections.
During the last four or five sessions, the Nifty Next 50 index also witnessed a dramatic increase, climbing from 47,000 to an astounding 49,424.
Nifty Heatmap
The Nifty heat map vividly reflects this upward trend, with major companies showcasing significant movements. State Bank of India surged by 4%, HDFC Bank by 3.5%, ICICI Bank by 4.7%, and Kotak Bank and Axis Bank both made substantial gains. Energy stocks and FMCG (Fast-moving Consumer Goods) companies also demonstrated upward movements, along with notable increases in auto stocks. Adani Enterprises soared up by 7%, while Larsen & Toubro (L&T) saw a rise of 3.8%.
Sectoral Overview
Across various sectors, substantial gains were observed. PSU Banks witnessed a rise of 3.9%, private Banks grew by 3.5%, Public Sector Enterprises (PSEs) soared by 3.1%, the energy sector saw a 2.6% increase, infrastructural stocks climbed by 2.6%, commodities experienced a rise of 2.3%, and Real Estate clocked a 2% surge. Even though auto and consumption sectors showed relatively weaker performance at 1%, it is worth noting that a 1% increase in a single day is substantial. Defensive stocks such as Pharma and FMCG occupied the lower slots, as this outcome was widely anticipated.
Public Sector Enterprise stocks have experienced significant movement this month, currently accumulating an 18.5% increase. Furthermore, over the past year, these stocks have witnessed a staggering growth of 48.5%. The real estate sector, however, is the frontrunner at the moment, with a remarkable growth rate of 50.3% over the same period.
Mid & Small Cap Performance
Mid-cap stocks continue to demonstrate exceptional growth, with a massive gap-up opening and a close near the 44,000 mark. Similarly, small-cap stocks witnessed considerable gains, opening with a significant gap-up and closing near 13,489. This surge can, in part, be attributed to the high expectations the current government has built with its successful track record in gathering votes. Unless any unforeseen events occur between now and the 2024 elections, the market is expected to continue its upward trajectory. This stability has instilled confidence in overseas investors, which has resulted in a steady influx of foreign capital into the Indian stock market.
Bank Nifty Overview
It is noteworthy that the Nifty Bank index, which has traditionally led market rallies, demonstrated an extreme move, surging from 44,800 to 46,430. Traders who were short in the market during this time faced losses due to the unprecedented volatility in Bank Nifty. This remarkable rally resulted in an all-time high for the index. Public Sector Enterprise stocks have also been ruling the market, with many stocks surpassing the 7,000 mark and PSU banks inching close to a new all-time high at 5,332.
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