Weekly Big Picture : Nifty Starts January Series on a Strong Note; Metal and Media Stocks Gain during the Week

Weekly Action

Nifty, -0.2%; Sensex, -0.3%; Nifty Midcap, +0.6%; Nifty Smallcap, +1.1%; and Model Portfolio, +1.8%.

Market Pulse Confirmed Uptrend

Weekly Market Review

Indian markets which made new all-time high last week took a breather during the current week. Friday’s rally helped benchmark indices pare most of its losses for the week, which helped January series of F&O to start on a strong note. During the week, Nifty added a distribution day on Thursday, taking its count to five. Two distribution days are set to expire next week.

It was a mixed reaction on the sectoral front. Nifty Metal (+1.9%) and Media (+1.6%) were the top advancers. While Nifty FMCG (-0.7%) and IT (-0.4%) were the top decliners.

PSU Bank index rallied about 3% today, as the RBI is set to conduct the second round of “Operation Twist” on December 30. Central bank will purchase 10-year bonds worth Rs 10,000 crore, while simultaneously selling four bonds maturing in 2020 for up to the same amount through open market operations.

Looking ahead, we remain positive on the general market after the market status was changed to a Confirmed Uptrend recently. It’s a good time to reiterate the O’Neil strategy of buying high and selling higher. Do not hesitate to selectively increase risk in quality ideas emerging from early-stage bases and trading at all-time highs. Also, stocks that had pulled back in price on low volume when the market was consolidating, have now rebounded from their moving averages when the market started making higher highs, can do well.

Key News

H.G. Infra Engineering received Rs 522 crore highway project in Haryana from NHAI. The stock was up 7.2% today.

Page Industries’s long-term rating has been reaffirmed at AA and short-term at A1+ by ICRA. The stock gained 5.6% today.

Indian Overseas Bank confirmed the sanction of Rs 4,360 crore from the government on a preferential allotment of equity shares. The stock advanced 5.8% today.

What do you think? Please email us any questions or comments.

Continue reading with a MarketSmith India Premium subscription…

To Read Detailed Reports including Stock Recommendations, Idea Lists, Evaluate Stocks etc. Subscribe to MarketSmith India

Leave a Reply

Your email address will not be published. Required fields are marked *