The WeekendInvesting Newsletter
Another superb initiative from our Research Desk is The WeekendInvesting Newsletter. This is a daily newsletter that summarizes all the stories we cover during the day(market nuggets), including the daily byte that we shoot every evening. This newsletter will be delivered to your email every evening on market days, providing you with a wealth of market-related information. The newsletter includes both summaries and long-form blogs for all the market nuggets covered. These blogs are also linked to the videos we shoot, so you can choose to watch or read the content according to your preference.
Check out our past newsletters.
Nifty on the Daily Chart – 50 & 200 DMA Perspective
The Nifty daily chart presents a mixed picture. While we’ve seen a strong 1,000-point rally from the recent lows, the index is now facing resistance at the 50-day moving average (DMA). This level, represented by the golden-orange line, is proving to be a hurdle. Additionally, the 200 DMA is about 500 points away, acting as another significant resistance.
Once Nifty successfully negotiates the 50 DMA, further consolidation may be required before making an attempt to break past the 200 DMA. My personal view is that we may see some sideways movement for now. A sharp decline seems unlikely unless triggered by global factors, as most negative results and weak earnings have already been factored into stock prices.
Several positive factors are also in play. The government’s recent tax break is expected to release nearly ₹1 lakh crore directly into the hands of consumers, with secondary and tertiary effects potentially totaling ₹3 lakh crore. Additionally, the Reserve Bank of India (RBI) is preparing to restart its rate-cut cycle, which should support market stability even if a sharp rally doesn’t materialize immediately.
Nifty – Weekly Perspective
On a weekly basis, Nifty is holding steady around the 23,500 level, a key psychological and technical support. It has been a good correction so far, and while we may spend more time consolidating here, the eventual direction appears to be upward. This week, the index ended with a modest 0.3% gain, signaling a potential base formation.
S&P 500 Overview
The S&P 500 also softened slightly this week, but there was no significant damage. The U.S. market continues to hover near its recent highs, reflecting underlying strength.
GOLD Overview
Gold surged 3.5% this week, reaching its highest-ever weekly close at ₹85,000 per 10 grams. The rally has been relentless—just a few months ago, towards the end of 2023, gold was trading at ₹75,000. The pattern has been consistent: a strong run-up, followed by a brief consolidation, and then another leg higher.
The growing demand for gold reflects a broader shift in investor sentiment. Institutional and retail investors have relatively low exposure to gold, and as this interest increases, the asset is likely to gain further. The trend suggests that gold will continue to be a sought-after asset in the months ahead.
Dollar Index Overview
The dollar index is currently at a crossroads. It dipped 0.37% this week and has been struggling to break past the 110 level. If it fails to hold support and breaks down further, it could be a significant positive for India and other emerging markets, as well as for precious metals like gold.
However, if the dollar regains strength and moves higher, foreign fund outflows from India could continue. The next few weeks will be crucial in determining the dollar’s direction and its impact on global liquidity.
Benchmark Indices Overview
Over the past week, there has been little change in the major indices. Nifty, Nifty Next 50, and other benchmarks remained largely flat, making this a quiet week in terms of movement.
Over the last month, small caps have been the most volatile, still showing a negative trend. However, Nifty has stabilized, indicating some resilience in large caps.
In the last six months, Nifty has lost 3%, while Nifty Next 50 has been the biggest laggard, down 12.2%. Midcaps and small caps, meanwhile, remain positive, up 6–7%.
On a one-year basis, all major indices are still in the green, which suggests that the overall market health remains intact. The correction seen in the last few months has not yet turned into a major downturn, and for now, disaster has been avoided.
Sectoral Overview
Biggest Losers This Week:
FMCG (-5.6%) – Post-earnings results have triggered further declines.
Defense stocks – No major announcements in the budget led to a sell-off.
Real estate stocks – Some of the recent gains have been given up.
Consumption stocks – Expected to perform well post-budget, but have surprisingly declined.
Sectors That Performed Well:
Pharma, metals, capital markets, and IT – These sectors have been running strong over the past week.
Taking a broader view of the past year, most sectors remain stable, except for energy, oil & gas, and PSU banking, which have lagged.
From a sectoral momentum perspective, the strongest sectors based on various timeframes (weekly, monthly, three-month, six-month, and one-year trends) include financial services, IT, private banks, autos, and pharma. These sectors are currently outperforming and should be considered for discretionary investment opportunities.
On the weaker side, energy, public sector enterprises (PSEs), CPSEs, real estate, oil and gas, and defense have been struggling and remain at the lower end of sectoral rankings. For investors, the message is clear: momentum is with financial services, IT, and pharma. If you are looking for opportunities, focus on stocks within these leading sectors. Conversely, sectors like oil and gas, real estate, and CPSEs have underperformed across different timeframes and may take time to recover.
Rebalance Update
We give advance notice here on the upcoming changes in your smallcase for Monday. This advance notice can be used to ignore Monday’s update if there is no change. If there is a change indicated you can use the smallcase app or log in to weekendinvesting.smallcase.com to see the rebalance.
Note: We are not including LIQUIDBEES as an ADD or an EXIT count.
