MARKET PULSE:
Status: Confirmed Uptrend
Highlights:
Four up and one down days
Weekly Market Review:
The Indian market has kept its winning streak alive in 2018, as the Nifty and the Sensex posted a weekly gain of 0.27% and 0.28%, respectively. Post the holiday session, the year 2018 started on a muted note with the Monday’s trade closing lower at 0.90% for the Nifty. However, markets were quick to pick up the momentum toward the close of the week, as Thursday and Friday’s action each brings a gain of 0.59% and 0.51% on the Nifty.
In the year 2017, Nifty small cap and mid cap were the leading indices, as they posted yearly gains of 56% and 45.9%, respectively. However, the beginning of year 2018 was no different as both the indexes clocked the weekly gains of 3.29% and 1.73%, respectively, outperforms convincingly.
On the sector performance front, the metal stocks charged into 2018, with gains of about 4.82%. During 2017, the Nifty metal index had shined with its handsome gains of about 48.54%. Media and Pvt bank stocks too started the year on a positive note, with gains of about 1.88% and 0.67%, respectively, for the week. On the downside, the Nifty Auto index lost about 0.67% for the week, despite the auto industry reporting a positive Auto sales data of December.
Leading stocks follow suit, as MarketSmith India IND 47 our proprietary list of top 47 stocks which has strong technical and fundamental characteristics headed higher by 3.64%.
During this week, the Nifty had shed two distribution days, whereas the Sensex had shed one distribution day, leading to a distribution count of four and three, respectively. Since both the key indices are trading constructively above their moving averages of 50-DMA and 200-DMA with low distribution count, we are comfortable in keeping the Indian market status at “Confirmed Uptrend.”
Going forward in the year, the market is expected to perform better and make new highs. During the budget session, we might observe some volatility in the market, but we expect that the government will come up with a market-friendly budget, which helps companies to report strong earnings. Estimates are very bullish for 2018, which will set new bars for the market.
During the coming week, the following events could serve as the market movers:
- Consumer Price Index data for December 2017 on January 12, 2018.
- Index of Industrial Production data for November 2017 on January 12, 2018.
- Q3 FY 2018 results of TCS, Indusind Bank, and Infosys, among others.
Current Outlook:
– Market environment conducive for new purchases, but remain selective.
– Focus on fundamentally strong stocks breaking out of strong technical patterns.
– Stay disciplined and exercise sound buy and sell rules.
To Read Detailed Reports including Stock Recommendations, Idea Lists, Evaluate Stocks etc. Subscribe to MarketSmith India.