On Tuesday, traders on Dalal Street continued to shrug off fast escalating pandemic cases and tightening restrictions by purchasing power and financial stocks, sending benchmark indexes up for the third day in a row. If daily virus cases exceed 20,000, Mumbai will impose a lockdown, while Delhi would impose a weekend curfew. Other states are enacting restrictions that will most likely affect consumer-oriented businesses.
The 30-stock Senex index rose 672.71 points, or 1.14 percent, to 59,855.93. The NSE Nifty Index climbed 179.55 points, or 1.02 percent, to 17,805.25. As the BSE market value surged to Rs 271.13 lakh crore, equity investors increased their wealth by Rs 1.87 lakh crore. The market’s surge over the last three sessions has increased investors’ wealth by Rs 7.75 lakh crore.
Broader market indexes finished higher as well, although they trailed their headline counterparts. The Nifty Smallcap Index increased by 0.32 percent, while the Nifty Midcap Index increased by 0.27 percent. The Nifty 500, the broadest index on the NSE, finished 0.75 percent higher.
Markets will be guided this week by macro data, Omicron, and global patterns
The key major drivers for the stocks market in the first week of 2022, according to analysts, will be macroeconomic data releases, the Omicron catastrophe, and worldwide movements. The Indian stock indexes achieved many milestones in what turned out to be a historic year, with the 30-share Sensex gaining 10,502.49 points, or 21.99 percent, in 2021.
“This week marks the beginning of a new month, and participants will be keenly scrutinising certain critical high-frequency data including monthly auto sales, India Manufacturing PMI, and India Services PMI,” said an expert. Updates on the pandemic issue and worldwide market performance will also be essential.
Despite the fact that the markets have been recovering over the previous two weeks, he believes it is too early to declare that “we’re out of the woods.” “In light of the conflicting signals, players should take a cautious approach and choose a hedged strategy. Almost all sectors are benefiting from the rebound, but we believe banking, pharmaceuticals, information technology, and fast-moving consumer goods will outperform others in the next week,” the expert added.
Markets will start the new year 2022 with cautious sideways movement, according to another expert, as Omicron spreads fast both in India and abroad. “However, we remain positive and estimate the Nifty to return about 12-15 percent in 2022, owing to the economy’s continued recovery and solid profits growth.”
“While the market trend may be turbulent in the short term due to possible risk from the Omicron variation and weak global signals,” the expert noted, “in the long run, good earnings delivery coupled with favourable macroeconomic data will hold the key to driving markets higher.”
This week, PMI data for the manufacturing and services sectors will be released, which will have an impact on trade mood. Despite persisting concerns over rising Omicron instances, the domestic market is projected to remain resilient, bolstered by a positive long-term growth outlook for the economy. The market will be watching the RBI’s decision on interest rate rises closely.
Automobile businesses will be under the spotlight on Monday when monthly sales data is released. For equities investors, the year 2021 was very profitable. After the pandemic-related fall in March 2020, the 30-share benchmark Sensex climbed over the historic 50,000 and 62,000 peaks last year.
According to experts, the year 2021 saw a good recovery despite ongoing problems from new coronavirus strains, allowing it to beat its worldwide counterparts. “Strong retail participation, economic recovery, vaccination coverage, and increased hunger for Indian products and services all contributed to the strong momentum.”
The domestic primary market saw record IPO financing, boosting investor confidence in India’s economic narrative. Sentiment will also be influenced by the movements of FIIs, Brent crude, and the currency.
Source: Economic Times
Disclaimer: This blog is exclusively for educational purposes and does not provide any advice/tips on investment or recommend buying and selling any stock.