Markets have gained 2 per cent amid lower volumes during the New Year holidays, as investors and traders keep an eye on Omicron’s position. The bulls dominated during the week ending 31 December. The benchmark index gained 4 per cent from its December 20 lows on improved sentiments on the back of value buying and short covering.
While all the sectors participated in the rally, the pharma sector emerged as the biggest gainer. It was followed by Auto, Banking & Financial and FMCG indices.
On the next trading session i.e. January 3, the market can give the first reaction on the GST collection for December. The GST collection stood at over Rs 1 lakh crore for the sixth consecutive month at Rs 1.29 lakh crore this month. According to experts, the market may remain rangebound positive due to reduction in global cues and lower volumes. However, PMI, COVID cases as well as domestic signs should be monitored.
Ajit Mishra, VP-Research, Religare Broking, said, “Even though the market has been showing recovery for the last two weeks, it is too early to say that we have recovered from the tough times. Recently, some other states have imposed restrictions due to the increase in the cases of COVID.
Yesha Shah of Samco Securities said, “Investors should take a long-term view instead of short-term in the midst of volatility and take positions in that order.”
Here we list 10 key factors that will keep traders busy this week:
The markets are volatile due to the recent increase in the cases of COVID. On January 1, 22,775 cases were reported in India, which is the highest figure since October 2. Along with this, the Center has extended the restrictions related to COVID till 31 January. Several states including Maharashtra, Delhi, Tamil Nadu and Haryana have also imposed restrictions to prevent the virus from spreading. The market will keep an eye on COVID cases and new restrictions.
auto stocks
The market will react to the monthly sales figures released over the weekend. So far, the data indicates that the chip shortage problem is going away. Sales of Xcorts declined by 39 per cent, while that of Mahindra & Mahindra declined by 19 per cent but sales of commercial vehicles and passenger vehicles increased.
Sales of Eicher Motors in the commercial vehicle segment grew 25.8 per cent and that of Royal Enfield grew 7 per cent. Tata Motors reported 24 per cent growth in its domestic sales in December.
The country’s largest car maker Maruti Suzuki saw sales decline by 4.4 per cent year-on-year on weak domestic growth, though it exported 22,280 vehicles in December, its highest ever.
economic data
Dalal Street will keep an eye on the market manufacturing PMI data for December coming on January 3, while the market composite PMI and services PMI data for December will be released two days later. In October, India’s manufacturing PMI registered an increase for the fifth consecutive month. On the other hand, there was a decline in the services PMI in November, although it was higher than the market estimate.
FII, DII Flow
FIIs continue to be net sellers, though selling has slowed. This is probably due to the New Year holiday season around the world. In the last week of 2021, he sold a total of Rs 2,217 crore. However, support from Domestic Institutional Investors (DIIs) continued and they bought Rs 4,273 crore during the week. In December, he made a total purchase of Rs 31,231 crore, which was the highest monthly purchase in 2021.
In 2021, FIIs have sold a total of Rs 91,600 crore, although DIIs have bought Rs 94,800 crore.
FOMC Minutes
The signals will be closely watched by the FOMC minutes of the December meeting of global investors, which will be released on January 6.
“Indian markets may see movement along the lines of global markets, as investors may try to read signals amid Fed’s action plan,” said Shah of Samco Securities.
technical view
Technically, Nifty has shown strength, forming a bullish weekly candle on the daily and weekly charts as it gained 0.87 per cent on December 31 and 2 per cent during the week. This is giving signs of bullishness in the short term.
Experts currently see significant resistance for the index at 17,400-17,500, followed by 17,640. If this is crossed, the bearish setup may end. He said that the 20 Day Moving Average of 17,150 would act as a strong support.
Nagraj Shetty, Technical Research Analyst, HDFC Securities said, “Daily chart moment is forming a log bull candle indicating an upside breakout of the Down Sloping trend line barrier at 17,250 levels. This is a positive sign and a bullish trend can be expected in the short term.” He said a bullish bearish setup is likely to end above 17,640 and more upside could be seen on the daily and weekly timeframe charts. There is immediate support at the level of 17,260.
f&o cuz
At the start of the January series, the maximum call open interest was seen at the 18,000 strike, followed by the 17,500 and 17,700 strikes. Call rewritings were for 18,000 strikes, followed by 17,700 and 17,800 strikes.
Most put open interest was at 17,300 strikes, followed by 17,200 and 17,000 strikes. Put writings were for 17,300, followed by 17,100 and 17,000 for strikes.
Experts said that the weekly option data indicates that Nifty may trade at 17,000-17,700 in the near future, while the downside may be limited due to the elimination of volatility.
On the volatility front, India Vicks remains near 16 level, closing at 16.22 as compared to 16.14 on weekly basis.
bank nifty
Bank Nifty remained strong during the week, rising 1.79 per cent to close at 35,481.70.
The index has formed a bullish candle on the daily as well as the weekly charts, indicating strength in the near future. Experts said that if the strength continues, then the Nifty can again go above 17,500.
Chandan Taparia of Motilal Oswal said, “It has formed a bullish candle on the daily scale and has recovered from the last two weeks low. Now it has to hold 35,500 level to move towards 36,600, while support can be seen at 35,250 to 35,000 levels.”
corporate action
On January 4, Quantum Digital Vision (India) Ltd. the EGM will be
On January 5, Johnson Farmcare’s stock split and Mangalam Timber Products Ltd. Will be implemented.
Apart from this, January 6 will be the interim dividend of Mazagon Dock Shipbuilders, January 7 is the date of bonus issue of Indian Metals & Ferro Alloys.
Disclaimer: The views and investment tips of investment experts on Moneycontrol are their own and not that of the website or its management. Moneycontrol advises its users to consult certified experts before taking investment decisions.
.