Where is the market headed?
Today’s bite is for 29th May, Thursday – another day where there was no significant move as such. The market remained largely stable. From overseas, the news came in that the court has challenged Trump’s tariff policies. This brought some relief and triggered a mild rally across global markets.
As of now, there’s no major trigger expected. Any significant move will likely be based on the anticipated interest rate cuts in June or other major overseas developments.
Market Overview
Nifty moved just 0.33%—still within a tight range. It has recovered nicely from the bottom, showing no clear desire to go up or down.
Nifty Next 50
Nifty Junior was up 0.15%—very flat.
Nifty Mid and Small Cap
Midcaps rose 0.56%, slightly better, but again nothing remarkable. Small caps inched up 0.44%, with very small daily candles, indicating slow upward movement.
Bank Nifty
In Bank Nifty, the index was up 0.23%, trading toward the higher end of its range, possibly waiting for a breakout.
GOLD
Gold remained absolutely flat at 0.08%. Interestingly, gold took a sharp dive in the morning after news of the tariff challenge. But as uncertainty eased, it recovered by day’s end, closing at 9570 per gram. It seems to be consolidating, waiting for the next move.
Advance Decline Ratio
Advance-decline ratio was also flat at 291 to 207. However, there was a slight uptick in advances toward market close, which is always a good sign.
Heat Maps
In the Nifty heat maps, the gainers included: Sun Pharma, Adani Ports, Infosys, and Axis Bank.
Losers were mostly: Bajaj Twins and others with no major moves.
In the Nifty Next 50: Lodha went down.
DLF, Jindal, Swiggy, Pidilite, LTIM, and Motherson (with a bonus), Adani Green, and ICICI Prudential performed well.
Sectoral Overview
Top sectoral gainers: Metals: +1.2%, Real Estate: +1.1%, Pharma: +0.92%, Capital Markets: +0.8%. Other sectors also saw gains. Only FMCG and PSU banks were down. PSU banks had seen recent gains, so the fall may be profit booking. FMCG has been weak over the past week, with only the tourism sector performing worse.
In the last week: Defense rose 3.96% Capital Markets, Nifty Media and Real Estate also performed well.
Sector of the Day
Nifty Metal Index
In the metal space, movers included: Welspun Corp (+10.5%), Lloyds, Jindal Steel, and Hindustan Zinc. The metal sector charts are looking very strong right now.
Story of the Day: Three Mistakes to Avoid in the Current Market
Success or failure in investing often depends more on our behavioral and emotional responses than on pinpointing the right entry or exit. The market constantly tells a story through price action, and our inability to correctly interpret that story—either by guessing randomly or sticking too rigidly to rules—can lead to poor outcomes.
Let’s explore three market indices—Nifty 50, Midcap 150, and Smallcap 250—to understand where things stand. Nifty has risen from the 21,500 level to nearly 25,000, gaining about 15% from its recent low. A discretionary investor might now be wondering: “Should I buy? Have I missed the rally? Is it too late?” Similar questions arise in midcaps, which have gained about 22% from their bottom. If you recently saw a stock at ₹50 and it’s now at ₹80, your mind anchors to that earlier price, even if you believe it could reach ₹160. Small caps have seen a 25% rally from the bottom, moving from 13,000 to 16,000. Many investors likely sold during the downturn, which is why market bottoms form—when sentiment is the weakest.
The dilemma continues: Is this the start of a new rally or just a temporary bounce? There’s even a head-and-shoulders pattern forming. If it plays out negatively, the fall could be steep. These uncertainties create emotional turbulence—should I sell, hold, or buy more? Should I act now or wait? Each decision comes with its own anxiety and potential regret.
For instance, we saw a similar situation after the Pulwama attack. Markets rose unexpectedly.
During the Indo-China border operations, markets dipped only briefly before bouncing back. The truth is that markets are influenced by a variety of factors—not just company earnings or liquidity flows, but also narratives, global politics (like Trump’s moves), and market sentiment.
This emotional rollercoaster means every action can lead to regret. If you didn’t buy, you regret missing a 25% rally. If you did buy, you may regret not buying more. If you sold, you might be upset that the market continued rising afterward. Even partial selling can cause remorse if the part you kept didn’t perform. Emotionally driven decisions almost always come with some regret.
The second major mistake is trying to time the market. There’s a misplaced confidence among many investors that they can forecast market moves. Even professional analysts who spend their days making predictions get it wrong often. Regular investors are no different, yet they tend to believe they can pinpoint market bottoms or tops. This overconfidence leads to missed opportunities.
You might be waiting for Nifty to fall to 19,000 before buying. But what if it never does?
After the COVID crash, markets bounced back rapidly from March 2020 and had fully recovered by September–October. Despite economic chaos, joblessness, and broken supply chains, markets surged another 20%. Those waiting for a correction were left behind. Similar 15–20% rallies happened in May 2023, November 2023, and June 2024.
Despite reasons to be cautious—such as political uncertainty when the ruling party lacked a clear majority—markets continued climbing. Waiting for a perfect entry often results in missing the entire rally.
The third mistake is staying invested in non-performing stocks. Investors often believe that time will eventually turn things around, but that isn’t always true. If a stock is not performing while the broader market is rallying, it’s likely a dud. Giving it more time won’t help. You might hope something changes in the company, but that’s wishful thinking, not investing. If your stock isn’t moving while the rest of the market is, it’s a clear signal to exit. Be ruthless—if the stock doesn’t meet your original criteria or rationale for entry, it’s time to let go.
Always have a clear reason for being in a stock. Whether it’s strong fundamentals, a sectoral trend, or a technical pattern—stick to it. If you bought a stock just because a friend recommended it, you’re setting yourself up for disappointment.
So, what’s the escape route from all these problems? The answer lies in Momentum investing through a rule-based, non-discretionary system. This removes emotional biases and reduces regret. You follow clear rules for entry and exit, which simplifies your life and helps you sleep better. It may not always guarantee profits, but it certainly offers a structured, disciplined approach. Let the market guide you and respond to it through your rules. You become an observer rather than an emotional participant.
So, do you follow a rule-based strategy in your investing? Or is your approach more ad hoc, driven by tips and gut feelings? Share your candid thoughts in the comments. Thank you for tuning in.
WeekendInvesting launches – The Momentum Podcast
This episode of THE MOMENTUM PODCAST features Manubhav, a third-generation real estate professional, sharing his unique journey navigating both worlds.
Discover:
✅ FROM PROPERTY TO PORTFOLIO: Manubhav’s transition from his family’s established real estate business to exploring equity investments.
✅ MARKET WISDOM: His candid experiences with market swings, including COVID-19’s impact on his SIPs, and lessons learned from F&O and smallcase.
✅ THE BIG COMPARISON: A fascinating look at real estate vs. equity returns, featuring real-world numbers from his family’s 40-year property investment.
✅ UNCOMMON INSIGHTS: Why gold is a family favorite and the surprising state of equity investing in smaller Indian towns.
