Nifty 50
Indian Stock Market Takes a Breather Ahead of NFP Report: What You Should Know
Table of Contents
On December 26, the Indian stock market saw a pause in its upward momentum as the benchmark indices, Nifty and Sensex, gave up most of their early gains. This was ahead of the monthly F&O expiry, with trading volumes staying low due to year-end holidays. Investors are wrapping up their books for the year, leading to subdued activity. Nifty 50
Subdued Trading Activity
- Sensex: Up by 24.95 points (+0.03%) at 78,497.82
- Nifty: Up by 21.70 points (+0.09%) at 23,749.35
- Market Breadth: 1,438 stocks advanced, 1,771 declined, and 140 remained unchanged.
Mid and Smallcap Stocks Under Pressure
The Nifty midcap and smallcap indices were under some pressure, each down by 0.5%. Despite this, the broader market trend remains positive. The current correction is seen as healthy, part of an ongoing upward trend, rather than a shift into a bearish phase.
What Does This Mean for Investors?
- Market Consolidation: Ruchit Jain, Vice President of Technical Research at Motilal Oswal, suggests that the markets may consolidate in a narrow range due to the subdued activity and lack of major triggers. The downside appears limited, but we may see a time-wise correction until earnings revive.
- Risks to Watch: Rising bond yields and a strong U.S. dollar index could weigh on market sentiment, especially in emerging markets like India, which often move inversely to the dollar. Nifty 50
Sector-Specific Performances
- Banking Stocks: Both Nifty PSU Bank and Private Bank indices saw nearly 1% gains, with strong performances from HDFC Bank, SBI, and ICICI Bank.
- Auto Stocks: Auto stocks continued their rally, led by Maruti Suzuki, M&M, and Tata Motors.
- FMCG and Oil: Nifty FMCG, Oil & Gas, and Consumer Durables also showed slight gains of up to 0.3%.
- Realty Sector: The Nifty Realty index was the only one to dip, falling by 0.4%.
Notable Stock Performances
- BPCL: Shares rose by almost 2% after winning a solar energy project bid.
- Panacea Biotec: The company’s shares surged 5% after securing a contract with UNICEF to supply polio vaccines.
- UltraTech Cement: Stock edged higher after acquiring a 26% stake in a renewable energy firm, Clean Max Sapphire.
Looking Ahead
- Immediate Support: Market experts are eyeing the lower end of last Friday’s bearish candle as immediate support.
- Top Gainers: Axis Bank, Maruti Suzuki, SBI, ICICI Bank, and Kotak Mahindra were among the top gainers.
- Top Losers: Asian Paints, Cipla, Dr. Reddy’s, Trent, and Tata Consumer Products Limited were among the biggest losers.
What Should Investors Do?
The Nifty 50 took a breather as we approach the end of the year, and the broader market outlook remains positive. However, a time-wise correction may continue until the earnings season picks up. Keep an eye on external risks like bond yields, the dollar index, and stock-specific movements in the upcoming Q3 results.
Disclaimer: The views and investment tips expressed by experts are their own and not those of Moneycontrol.com or its management. Always consult certified financial advisors before making investment decisions.
Conclusion:
As the Nifty 50 takes a breather ahead of the Non-Farm Payroll (NFP) report, market activity remains subdued due to year-end holidays and the absence of major triggers. While the broader market trend remains positive, a time-wise correction could persist until earnings season revives investor sentiment. Key factors like rising bond yields and a strong dollar index are risks to watch, and stock-specific movements in upcoming Q3 results will likely dictate short-term market direction. Investors should stay cautious but optimistic, monitoring external factors that could influence market dynamics.
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