Weekly Big Picture : Energy and Pharma Stocks Lead; Maruti Fell on Earnings Miss

Energy and Pharma Stocks Lead; Maruti Fell on Earnings Miss

Market Pulse

Uptrend Under Pressure

Weekly Action

Benchmark indices closed lower. Nifty, -1.2%; Sensex, -1.0%; Nifty Midcap, -2.9%; Nifty Smallcap, -3.3%; Model Portfolio, -1.1%; and MSI Ind 47, -1.4%.

Weekly Market Review

Benchmark indices started the week on a positive note. The Nifty closed above 10,950 level on Monday with the help of energy stocks led by Reliance Industries. However, the Nifty closed lower on Tuesday as concerns loomed over the global economic growth. It ended its five-day winning streak and added one distribution day.

The weakness in the market continued on Wednesday. The Nifty breached its 200-DMA intraday but managed to stay above it at the closing. Backed by Yes Bank and Reliance Industries, the Nifty closed Thursday’s session on a positive note. While Nifty Energy, IT, and PSU bank closed in the green, automobile and pharmaceutical stocks faced the selling pressure.

The Nifty gave up most of its day’s gains and finished below 10,800 level on Friday. The disappointing performance was led by  Zee Entertainment Ents. (-26.61%), Maruti Suzuki India (-7.5%), and Ultratech Cement (-7.4%). The Nifty added one distribution today.

For the week, Nifty Energy (+2.5%) and Pharma (+2.3%) were the top gainers. On the other side, Nifty Media (-17.1%) and Auto (-6.6%) were the top losers.

Currently, the distribution day count stands unchanged at five as one distribution day expired today due to aging. Today, the Nifty closed marginally higher than its 50-DMA, and we will downgrade the market to a Downtrend if it breaches that level or adds another distribution day in the coming sessions.

As the market is in an Uptrend Under Pressure, investors should proceed with caution. Unless a stock shows exceptional fundamental and technical strength, no new addition to the portfolio is advised.

In the coming week, the following events could move the market:

●      January 31: Fiscal Deficit (Dec)

●      January 31: Infrastructure output (Dec)

●      February 1: Manufacturing PMI (Jan)

●      February 1: FX Reserve

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