In the budget week, the market appeared to be recovering from a two-week decline in a row. In the week ended February 4, the market managed to close with a gain of more than 2 percent. However, mixed macro data, strong performance by India Inc., continued selling by FIIs, weak PMI data, interest rate hike by Bank of England and signs of tightening monetary policy by ECB were some of the factors that were driving the market. Seemed to fluctuate.
Last week, the BSE Sensex closed at 58,644.82 with a gain of 1,444.59 points, or 2.52 per cent. On the other hand, Nifty 50 closed at 17,516.3 with a gain of 414.35 points or 2.42 percent.
All sectoral indices closed in the green for the week ended February 4. The Nifty Metal index closed with gains of 6.6 per cent, Nifty Pharma by 4.6 per cent and FMCG index by 3.6 per cent.
In the week ending February 4, the performance of small-medium stocks was also similar to that of the giants. BSE Midcap and Smallcap indices closed with gains of nearly 2 per cent.
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Last week, there were 80 smallcap stocks in which there was an increase of 10-47 percent. These include Bharat Road Network, Jindal Drilling Industries, Ambika Cotton Mills, Elgi Equipments, MAS Financial Services, Nahar Poly Films, DB Realty, Prime Focus, Gujarat Fluorochemicals, IRB Infrastructure Developers and Genus Power Infrastructures.
On the other hand, in the smallcap space itself, stocks like Apar Industries, IFB Agro Industries, UTI Asset Management Company, Neuland Laboratories, Gujarat Themis Biosyn, Welspun India, IFB Industries, Multi Commodity Exchange of India and Radico Khaitan were among the top losers.
How will the market move next week
Gauravratnaparkhi of Sharekhan says that further Nifty has important support at 17400. If this support of Nifty breaks, then it can be seen going towards 17200 in the short term. On the other hand, resistance is visible for Nifty at 17800. This will act as the upper end of the consolidation range in the short term.
Ajit Mishra of Religare Broking says that the market will be the first to react to SBI’s results on Monday. Apart from this, the market will also keep an eye on the review of RBI’s upcoming monetary policy. What will be RBI’s commentary on inflation and economy growth amidst the harsh attitude of US Fed. The eyes of the market will be on this. Adit Mishra says that further we can see more consolidation in the benchmark index. Along with this, there is a possibility of heavy volatility in the mid and smallcap space. Therefore, make your investment decisions with caution and avoid taking highly leveraged positions.
Rupak Dey of LKP Security says that as long as Nifty remains in the range of 17400 -17800, we will see the consolidation going on in the market. A breakout in either direction in the short term will clear the market position.
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