Weekend Investing Daily Byte – 4 July 2024

July 4, 2024 3 min read

Market Overview

Happy Wednesday to everyone watching in the US. The markets are continuing their upward trend, leaving the bears exhausted and even the bulls mentally drained as the market climbs daily. Investors often find themselves tempted to switch stocks when their current holdings are stagnant, but it’s crucial to stick with your portfolio and strategy.

Today, we’re discussing whether the Sensex will reach 100,000 by 2025. Please share your views in the comments below. I’ll delve into this topic shortly.

Currently, the markets appear poised for higher ground. Despite Nifty opening with a gap up and giving up most gains to end flat, the overall trend remains upward. The market’s sectoral movements, especially leading up to the budget, suggest continued support for Nifty, potentially leading to more significant liquidity post-budget.

Nifty Next 50

Today, Nifty Junior performed better, rising by half a percent

Nifty Mid and Small Cap

The mid-cap segment saw a 0.68% increase. Small caps also closed higher, indicating a bullish sentiment. Closing higher after a dip during the day is a strong sign of market confidence. If the market opens high but closes down, it means there is resistance; if it opens high, dips, and then closes higher, it indicates strong upward momentum.

Nifty Bank Overview

The Bank Nifty remained almost flat with a slight 0.03% increase.

Nifty Heatmap

HDFC Bank disappointed with a 2.3% loss, while ICICI Bank gained 2.6%. Tata Motors, on strong JLR numbers, was up 2.3%. Sun Pharma rose 1.5%, and IT giants like HCL Tech, TCS, and Infosys showed gains, indicating a sectoral rotation.

Today’s heat map showed HDFC Bank losing 2.3% and Bajaj Finance down 2%, while ICICI Bank gained 2.6%. Tata Motors, on strong JLR numbers, was up 2.3%, and IT and pharma stocks continued their upward trend.

Sectoral Overview

Sectoral trends showed pharma stocks leading with a 1.4% increase, followed by IT stocks at 1.1%. These defensive sectors indicate a shift in market preference. FMCG stocks, surprisingly, lagged with a slight decline, which might suggest insiders know something about the upcoming budget’s impact on consumption.

Sectors of the Day

Nifty Pharma Index

Stock of the Day

Mazagon Dock India

Similarly, Mazagon saw significant gains, driven by its recent Navaratna status, exemplifying the benefits of holding onto winning stocks.

Cochin Shipyard

Cochin Shipyard had a remarkable day, rising 10% following a 7% gain the previous day. Since the beginning of the year, it has surged from Rs 685 to Rs 2680.

Story of the Day

Now, let’s discuss the possibility of Sensex reaching 100,000 by 2025. The Sensex has grown 800 times in 45 years, achieving a 15.9% CAGR. If this growth rate continues, the Sensex could hit 100,000 in less than 15 months. Historical data shows consistent doubling periods, supporting the projection of continued growth.

Ramdeo Agrawal, a respected figure in Indian investing, also predicts Sensex reaching 160,000 by 2029. Given the favorable economic conditions and lowering inflation and interest rates, this trajectory seems plausible. Missing out on market participation during potential high-growth periods could mean missing substantial gains.

Despite risks like geopolitical tensions and economic uncertainties, staying invested in the market is crucial. If needed, hedging with assets like gold can mitigate risks. For those hesitant to enter the market, gradually investing can balance exposure to market movements.

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    Weekend Investing Daily Byte – 4 July 2024