Indian markets have started 2022 on a strong note. Despite the rising cases of COVID-19 and the tough attitude of the FOMC, the market has managed to close the market with a gain of more than 2 per cent last week on the back of banking, oil and gas stocks.
Last week, the Sensex closed at 59,744.65 with a gain of 1,490.83 points or 2.55 per cent, while the Nifty closed at 17,812.70 with a gain of 458.65 points or 2.6 per cent.
If we look at different indices, BSE Bankex and Oil & Gas indices have lost 6.3 and 5.3 per cent respectively. At the same time, Healthcare and Information Technology indexes are broken by 1 and 2 percent.
In the week ended January 7, the performance of small-medium stocks was in line with the big stocks. The BSE Mid and Smallcap indices were successful in closing with a gain of 1 per cent. Last week, there were about 122 smallcap stocks that closed with a gain of 10-38 per cent. This includes BGR Energy Systems, Jaiprakash Power Ventures, Tata Teleservices (Maharashtra), 63 Moons Technologies, DB Realty, Urja Global, Jaypee Infratech, Greaves Cotton, JBM Auto, Steel Exchange India and India Cements.
10.7% growth expected in the construction sector, the government’s focus on infra projects will see further growth
On the other hand Hinduja Global Solutions, Spandana Sphoorty Financial, Surya Roshni, Dhanuka Agritech, Brigade Enterprises, Jubilant Industries, Max Healthcare Institute, Asian Granito India and Persistent Systems were the top midcap losers.
FIIs have also been net buyers in the month of January so far. During this week, the 10-year US bond yield has seen an increase and crude oil prices have crossed $80 and are looking closer to their October 2021 high.
Shrikant Chauhan of Kotak Securities Says that the increased concern due to inflation, the possibility of an increase in interest rates and the increase in the cases of COVID-19 is a challenge for the market. In the next one month, the domestic market will keep an eye on the upcoming quarterly results and the Union Budget in February.
How will the market move ahead?
Ajit Mishra of Religare Broking Says that after the recent rally, there is a possibility of consolidation again in the market and it will also be good for the market. Along with this, volatility in the market is also likely to remain. Mixed global cues and news related to COVID-19 will continue to show its impact on the market. He further said that the early results season along with the upcoming macroeconomic data like IIP, CPI and WPI will keep the market volatile. Our advice would be to remain cautious and hedge your positions while maintaining a positive outlook on the market.
Gaurav Ratnaparkhi of BNP Paribas It says that the index is consolidating near its important Fibonacci level for the last few trading sessions. The Everly Bollinger brand has turned flat which is an indication that the market may see consolidation for some more time. The overall structure of the market is currently showing signs of healthy consolidation and the market seems to be preparing for the next rally. Talking about now, in the next few trading sessions, Nifty can be seen trading sideways in the range of 17,650-18,000. On the downside, support is visible for Nifty at 17,650-17,600 levels, while resistance is seen on the upside for short term at 18000.
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