Market Outlook

The market was as expected from our morning update, extremely dull, with Nifty staying where it opened for pretty much the entire day. This is because people don’t want to take big positions ahead of a three-day long holiday. There are two sessions of US markets between now and Monday morning for us. Usually, whenever there is a holiday, there will be some either squaring off of positions or just not building new situations.

Nifty Heatmap

In the heat map, you can see that energy stocks took a beating, with Reliance leading the market down at -1.6%. This comes just after a lot of upgrades and higher targets were called for. Mahindra and Mahindra are down on news of sale by certain investors paring down of promoter stocks. Coal India, ONGC, and Titan also down, but a good amount of buying was seen in the metal space and in autos, with Tata Motors continuing that fantastic journey. In general, Tata stocks are doing extremely well, whether it is Tata Chemicals, Relis, TCS, Tata Motors, several other names like Titan, there seems to be a fantastic group momentum that is going on. L&T and Asian Paints did well, as mentioned, Bajaj Auto. Mr. Bajaj has already talked up his talk, almost rs1000 in the last two days. After his interview, he says the fair value should be 12,000, and people are believing that. Issa Bank and Kotak Bank, however, were down a little bit.

Sectoral Overview

Metals, as you can see, were up 1.4% for the day. There was a fantastic recovery here, and that is very good news given the fact that commodities and metals were in a slump. The surprise today is FMCG stocks where a 1% gain on FMCG has come around. FMCG has been dull and out. You can see one week, one month, three months, there has been no change at all. So, a good move here. Consumption and commodity stocks also up. Others were pretty muted. Private banks, energy, and Bank Nifty were slightly down, but not alarming at all.

Mid & Small Cap Performance

Mid-caps just staying in the middle of this range, so nothing really to report here but the kind of move that we saw in yesterday’s session has been totally neutralized, I think, and there is no impact of that as we speak right now. Small caps also have recovered almost half of yesterday’s fall, but not fully. So we are sort of in a limbo on small caps also. But always remember the kind of run small caps have had from that perspective

Nifty Bank Overview

4% from all-time highs is still a very respectable place to be at Nifty bank, which had been gunning up the last two sessions today was soft and led by private banks down. But again, Nifty bank is also now very close to all-time highs and still looking quite good. I think below this 4700 is where some weakness may start to emerge in this gap that it filled yesterday. I think the breakout of this top range is going to give a lot of new energy to it.

Highlight – Metal Index

Metals index, you can see very nice breakout that happened in the beginning of March, has come down, taken support from this breakout, and gone up again. So it’s good to see these technical patterns also where stocks and charts and sectors are taking support. And that will give you confidence that now at least the metals index is looking good. If you are a discretionary investor, you could look at buy on dips on metals until some support is given up.

Highlight – Nifty Junior

This Nifty Junior index is something that I really like and one of our strategies, NNF ten, is based on this, and it has been doing phenomenally well this year. Nifty Junior is just some other kind of an index where it has seen no correction whatsoever and it is making new highs almost on a daily basis. And today also it is up at almost 60,400. And in the last, you can see here, in the last month or so, it has gone from 56,000 to 60,000, while others have been just sort of flattish here.

Highlight – FMCG

This is what I was talking about regarding FMCG. A very good run on FMCG in the last couple of sessions. It does look like for now, some kind of bottom has been made at five 3200 and above 5004 500. I think we will start to see some traction on FMCG.

Highlight – Gold

This is a beautiful chart of gold in Egyptian dollars, Egyptian pound, beg your pardon? So you can see that in the last two sessions, the gold price has almost doubled in local currency. And since 2022, let’s say the last two years, it has gone four times and primarily on the back of currency devaluation.

Two days back, Egypt announced that they’re going to devalue their currency, and it was a shock to the system. So this is how, and I’ve put this chart here specifically to show you how if you are invested in gold as a hedge and your country goes for a toss, your currency goes for a toss, you get a silly government in place. All these scenarios which of course don’t look like at all happening for India in any near future, but who knows when things may hit the fan.

So this is where you will get real protection of wealth. And this is why you need that edge. I mean, why do you buy medical insurance? Why do you buy car insurance? Why do you buy life insurance? You are pretty sure that none of these will happen to you. That’s why sometimes some people say buying insurance is useless because it’s not going to happen to me. So this is something that of course we don’t wish happens to any economy. But what if it does?

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