Extending the winning streak for the sixth straight week, Indian equity markets ended the week on fresh record high levels with frontline benchmarks settling above their crucial 24,500 (Nifty) and 80,500 (Sensex) levels, supported by rally in information technology (IT) stocks after TCS reported better-than-expected Q1FY25 numbers.
The BSE Sensex surged 523 points, or 0.65 percent, to 80,519.34 during the week ended on July 12. The Nifty gained 178 points, or 0.73 percent, to 24502.15. Sector-wise, the BSE Information Technology index was top performer with a gain of 3.5 percent, followed by BSE Fast Moving Consumer Goods index (gain of 3.3 percent) and BSE Oil & Gas (increase of 2.9 percent). On the other hand, the BSE Realty index declined by 2.3 percent during the week.
As many as 31 stocks in the Nifty 50 index delivered positive returns for investors last week. With a weekly gain of 6.5 percent, Oil & Natural Gas Corporation emerged as the top gainer in the index. It was followed by ITC (up 5.8 percent), Wipro (4.7 percent), HDFC Life Insurance Company (4.6 percent), and Britannia Industries (4.4 percent). TCS, Infosys, Maruti Suzuki, Grasim Industries and Dr. Reddy's Labs also advanced by over three percent. On the other hand, Mahindra & Mahindra, Tata Steel, and Bajaj Auto declined 6.2 percent, 3.5 percent and 2.2 percent, respectively.
Nifty Outlook
Market veteran Deepak Jasani, Head of Retail Research, HDFC Securities, expects the uptrend could continue in Nifty and it could now gradually rise towards 24960, “Nifty ended strong on July 12 led by Information Technology stocks after Tata Consultancy Services surprised the street with its Q1 results. Nifty IT index touched the highest since Jan 2022. At close, Nifty was up 0.77% or 186.2 points at 24502.2” he said. Jasani added, Nifty broke out of the range of the last 6-7 sessions and closed at record highs. It however did not close at the intraday high. “On weekly charts, Nifty rose 0.73%, rising for the 6th consecutive week. Nifty could now gradually rise towards 24960 while 24174 and later 23993 could provide support in the near term”, Jasani commented. Bank Nifty
According to Rupak De, Senior Technical Analyst at LKP Securities, The Bank Nifty remained volatile throughout the day before closing flat. Sentiment might continue to favour the bulls, as the index appears to have found support at the 21 EMA on the daily timeframe on Thursday. “The buy-on-dips strategy looks best from the current perspective until it falls below 21,700. On the higher end, resistance is visible at 52,800; above 52,800, the index might continue its upward journey towards 54,000," De said. Market Macros
According to Vinod Nair, Head of Research at Geojit Financial Services, there is a mix of anxiety and excitement in the market due to the muted Q1FY25 earnings forecast and the expectation of a growth-oriented budget. On the other hand, the guidance of a strong GDP for FY25 evoked investor sentiment. On the global front, the release of softer-than-expected US inflation to a one-year low added fresh levers of optimism. This has raised the probability of a September US FED rate cut to 90%, which is evident in the fall of the dollar index.
He added it is expected that stock-specific moves to gain traction due to the ongoing earnings season; indeed, IT will be in the limelight due to the good start to the earnings and outlook. “The good progress in the monsoon and expectations of an uptick in volumes aided FMCG stocks to outperform the main indices. In the week ahead, economic data like China GDP, EuroZone CPI inflation, ECB policy, and the US Fed chair speech will be watched carefully by investors to get cues on market momentum", Nair said.