After hitting fresh record highs intraday, domestic indices NSE Nifty and BSE Sensex closed at record highs. Nifty topped the 18,800 level before ending the session lower by over 50 points at 18,758.35. The BSE Sensex surged over 500 points in trade to surpass the 63,300 level, hitting a record high for the fifth session in a row at 63,303.01, before closing at 63,099.65. The broader markets also closed in the green, as Nifty Smallcap 100 was up 0.6% and Nifty Midcap 100 ended 1% higher. All sectoral indices ended positively, barring Nifty PSU Bank which was down 1.23%. “Domestic market continued its quest for gains, boosted by FII inflows. However, markets will be sensitive to the Fed Chair’s remarks later in the day, as investors are expecting a moderation in the pace of rate hikes. An in-line comment will help to sustain the rally while loosening COVID-19 restrictions in China is providing relief to global markets,” said Vinod Nair, Head of Research, Geojit Financial Services.
Santosh Meena, Head of Research, Swastika Investmart
Indian equity markets are cheering at their all-time highs, snubbing the volatility of global markets. The broader market is also trying to catch up momentum as Nifty midcap and smallcap indices are still well below their all time highs. The beauty of the current rally is that the market is finding support from new sectors every day. In the second half of 2022, there is a clear trend of outperformance of Indian equity markets. This trend is likely to continue despite the fact that we are trading at expensive valuations compared to most of our global peers, as our fundamentals are strong and we have strong support from domestic money.
The market will react to Jerome Powell’s speech tomorrow, and auto sales figures will cause stock-specific movements. The market’s attention will then shift to the Gujarat election and RBI policy. Globally, news flow from China may continue to cause volatility, while the movement of the dollar index, US bond yields, and crude oil prices will be other important factors. The only concern is that the market is overbought, which may lead to some pullback or consolidation at higher levels, but there are no major signs of weakness. Technically, Nifty has immediate targets of 18888 and 19000, while on the downside, 18700 and 18500 will act as strong support levels.
Deepak Jasani, Head of Retail Research, HDFC Securities
MSCI rebalancing trades and basket buying by FPIs in the last half hour pushed up indices towards the end of the session. Cash volumes on the NSE were the highest in 6 months. Midcap index outperformed the Nifty even as the advance decline ratio surged to 1.73:1. A Santa rally appeared to come early for some markets, with Asian shares set for their strongest month since 1998 and emerging market stocks poised for their biggest monthly surge since 2009. European shares rose on Wednesday, joining Asian peers, although caution remained amid disappointing China factory activity data.
Investors looked to U.S. Federal Reserve Chair Jerome Powell’s speech for more clues on monetary policy stance. Dollar index fell around 4.3% in November, making this its biggest one-month drop since June 2010. This makes emerging market assets attractive. Nifty continues its march upwards with sharp spikes thrown in between. The fact that the large trades that happened on Nov 30 may not be repeated soon, means that Nifty could now rise gradually with some minor corrections thrown in between. On falls, 18614-18678 band could provide support.
Rupak De, Senior Technical Analyst, LKP Securities
Nifty made a new all-time during the day as the Nifty bulls remained at the helm during the day. Unlike the preceding two sessions, Nifty moved up smartly on Wednesday’s trading. The momentum oscillator RSI has given a falling trend line breakout. The crucial short-term moving averages are sitting below the index value, confirming the positive trend. The trend is likely to remain bullish as long as it remains above 18,600 as the support level shifts higher. On the higher end, resistance is visible at 18,800/19,000.