Where is the market headed?
It was a very good day for the markets. The trend today was very strong, and it managed to nullify all the short-term negative moves that we had seen in the last couple of sessions. Today’s move reaffirmed that the market is not willing to go down anytime soon. That seems to be the clear message coming across.
A very important development that happened today is that the RBI has floated a draft paper that will allow foreign direct investments into real estate projects. This can open up a huge amount of potential for real estate stocks and projects across the country. We will discuss that towards the end, but this news has clearly buoyed market sentiment today.
Market Overview
After yesterday’s volatile expiry session, the markets came back strongly and hit a new monthly high. We are not too far from the previous top, the July top, or even the all-time high — probably just 4 to 5% away. Nifty rose by 0.7%, which was a reassuring move.
Nifty Next 50
Nifty Junior also came back strongly, up 1.33%. In the last five to six sessions, Nifty Junior had been flattish, but today a clear breakout happened.
Nifty Mid and Small Cap
The mid-cap index recovered fully from yesterday’s dip with a 0.93% rise. Small caps were up 0.82%, and although they have spent the last eight days moving within a range, they seem to be forming a flag pattern and could move higher soon.
Bank Nifty
Bank Nifty gained 0.54%, reaching its highest level since the end of July.
GOLD
Gold continued its strong rally, up 0.49% today, even after a morning correction. The converted official price stood at ₹1,25,860 per 10 grams. However, you can’t buy gold at this price in the market because premiums are running very high. Silver is just not available anywhere.
This has now become a global frenzy where everyone wants to get their hands on some physical metal, but it is not easily available. This realization is spreading fast, and perhaps this change could continue for a long period.
Advance Decline Ratio
The advance-decline ratio was very strong today, with 375 advances against 124 declines.
Heat Maps
The Nifty screen was largely green, with stocks like L&T, Indigo, Bajaj twins, ICICI General, and Nestle doing very well. Bharti Airtel also performed strongly.
Nifty Next 50 showed a superb run, with ICICI General Insurance up 9% on earnings surprise, making it the big mover of the day. Among other gainers were Canara Bank, Bajaj Housing, Cholamandalam, Bank of Baroda, DLF, Adani Ports, LTIM, and HAL. It seems a new leg in the market may have started today, which could last for several days or even weeks.
Mover Of The Day
Sectoral Overview
Sector-wise, media was the only sector that ended lower. The biggest mover was the real estate index, up 3.04%, followed by PSU banks at 1.6%, tourism at 1.4%, capital markets at 1.4%, public sector enterprises at 1.2%, and CPSE at 1.18%. Real estate, which is up 4.5% in the past week, has started to recover after a weak phase. Over the past month, it was up only 1%, and over the last year, it is still down 15%. This could be the beginning of a new rotation towards the real estate sector.
Sector of the Day
Nifty Realty Index
Stocks like Sobha, Prestige, Brigade, Signature, and Godrej Properties all performed very well today. The real estate chart shows a clear bottoming-out pattern forming again and again, and now it seems ready to move higher.
U.S. Market
In the US, markets were flat yesterday. The S&P 500 was down 0.16%, Dow Jones was up 0.4%, Nasdaq slipped 0.76%, and Russell 2000 gained 1.38%. Even there, we can see some rotation towards small caps.
Tech and large-cap stocks are more subdued, while smaller companies are catching up. Among the top performers were Wells Fargo, Walmart, Caterpillar, Citigroup, and BlackRock.
Tweets Of the Day
The tweet of the day was about gold. It said that at every level, many people have doubted gold. Even now, a lot of people are not convinced and call it useless or unproductive. This narrative has been ingrained in the public mind over the last fifty years. Since 1971, when fiat currency took over, people have been told repeatedly that gold is useless. Over time, this has become accepted as truth. But from time to time, common sense returns, and people start realizing what’s real and what’s not. The idea that countries can just print pieces of paper with nothing to back them up has gone on for far too long. Now, that illusion seems to be breaking.
Even though gold is up 60% in the past year, very few people actually own it. That tells you how long this trend might last. Some think gold is rising only because of the festive season or the US-China tension, but this seems like a much deeper change. Some people are even comparing gold’s rally to sectoral runs — like defense or chemical stocks — assuming it will fall again. But that thinking may be misplaced. The world is changing right before our eyes. It’s like the frog in boiling water that doesn’t realize the temperature is rising until it’s too late. This may be a once-in-a-lifetime kind of situation. We could be living through a time that history will remember as the turning point between 2022 and 2025 when the world order began to shift.
Coming back to real estate, the RBI has reportedly proposed a draft that allows all real estate projects to receive foreign direct investment. Any project could raise funds from foreign investors, except for a few exceptions. Though this is based on source news, if it turns out to be true, it could be a game changer for the sector.
Real estate in India has long been starved of funds. If credible developers can access foreign investments, it could completely open up the market. Initially, there might be a sharp rise as premium projects rush to attract money, but over time, the supply of quality real estate will increase significantly.
