Weekly Big Picture – Energy and IT Stocks Lead; Sun Pharma Down on Whistleblower Complaint

Market Pulse

Uptrend Under Pressure

Weekly Action

Benchmark indices posted weekly gains. Nifty, +1.0%; Sensex, +1.0%; Nifty Midcap, -0.8%; Nifty Smallcap, -0.4%; Model Portfolio, -2.3%; and MSI Ind 47, -0.2%.

Weekly Market Review

The Nifty started the week on a subdued note and added a distribution day to the total count. This came after a weak trade was observed in the Asian market as China trade data started trickling in. However, the index came back strongly on Tuesday and closed above its important resistance level of the 100-DMA.

On Wednesday, the domestic market started the session on a positive note after official data showed that trade deficit narrowed on falling gold imports. But, it shed all its intraday gains toward the end to close flat. Continuing its flat trade on Tuesday, the Nifty managed to gain a mere 0.1%. Friday’s session ended flat but closed above the 10,900 mark.

For the week, Nifty Energy (+4.8%) and IT (+4.1%) were the top gainers. On the other side, Nifty Media (-4.3%) and PSU Bank (-2.4%) were the top losers.

The market remains in a Uptrend Under Pressure. The Nifty added a distribution day during the week taking the total distribution count to four. We will change the status to a Downtrend if one or two more distribution days are added. On the other hand, the market will be moved to a Confirmed Uptrend if the Nifty retakes the 10,942 level (its high during the recent rally).

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 25: FX reserves