Trade Setup for January 2: Nifty continues to struggle
at higher levels despite new records
The Highs and Lows of New Year’s Trading
Man, what a way to kick off 2024 in the stock market! January 1st was shaping up to be exactly what Indian investors were hoping for – building right on the momentum from the past year. The Nifty index even hit a new all-time high of 21,834, which had me pretty pumped.
But things took a turn real quick. Almost as soon as we touched that record level, the index tanked hard. For a minute there during provisional close, we were hovering below the key 21,700 level and I started to stress. Thankfully, after some final adjustments, the Nifty 50 managed to cling to that support at least. Whew!
It was definitely a rollercoaster way to start the new year. One minute flying high with fresh gains, the next feeling queasy as we plunged. But that’s markets for you – never a dull moment. After the steep fall-off, buyers stepped back in and stopped us from fully breaking down. Fingers crossed we can build on that stability as 2024 progresses. Only time will tell if this is just a bump in the road or a sign of more volatility to come.
In any case, it was exhilarating to watch the action live on Day 1. What a rush! Even with the whipsaw moves, I’m still feeling optimistic overall if we can hold above 21,700 on the index. The bulls aren’t ready to throw in the towel just yet. Bring on the rest of January – let’s see if we can get back to setting new records before too long.
Heavy Hitters Weighed Down the Index
It seemed like all the big dogs in the index started dragging it down from the highs. HDFC Bank, Reliance, Axis Bank – you name it, they were all taking a tumble. And when the heavy hitters falter, it really pulls the whole index lower with them.
Meanwhile, the midcaps just kept chugging along doing their own thing. For a hot minute there, the Midcap index was up a sweet 1%! But by closing bell, it had leveled out to a still respectable 0.6% gain. Guess those final minutes saw some broader selling creep in.
The PSU stocks keep powering ahead though. REC and PFC just didn’t stop running, building on their monster 230% rally last year. Those state-owned names have been on absolute fire. It’s pretty wild to see them dominating while the big private names pull back.
All in all, it was an interesting day seeing the different movements within the broader market. The big dogs fell but the middling stocks held their ground. And those PSUs just keep exceeding expectations. Will be interesting to watch if this divergence continues into next week!
Nifty Today
It was a mixed day of trading as the Sensex and Nifty 50 moved in opposite directions. While the Sensex managed to cling to modest gains, the Nifty found itself dragged lower by underperformance from the heavy hitters. Index giants like HDFC Bank, Reliance, and Axis Bank all saw their share prices decline substantially from the daily highs. As these major Nifty constituents faltered, it weighed heavily on the overall index. By closing bell, the Nifty had erased its gains thanks to the fall-off in its heavyweights. Meanwhile, midcap names kept chugging along, though they also saw some selling pressure in the final minutes. But the real winners were those PSU rocket ships like REC and PFC, which just kept powering to new heights. A divergence is emerging within the broader market, with growth slowing for Nifty majors versus continued strength among middling stocks and state-owned players.
Nifty share price
NIFTY Stocks Poised to Pop in 2024
The new year is a chance for a fresh start, and some of our blue-chip NIFTY shares look especially well-positioned to pop in 2024. Banking behemoth HDFC Bank has had a bit of a correction, dropping about 10% from its recent peak. But with strong fundamentals like healthy loan growth and industry-leading NIMs still in place, this dip could just be a buying opportunity. Look for HDFC Bank to get back to hitting new highs as economic conditions continue improving.
Reliance Industries seems a sure bet to keep powering ahead after completing its ambitious restructuring into three verticals – energy, retail, and telecom. Each business is now sharply focused on growth. As Jio fibers up India and retail expands overseas, Reliance’s transformation story remains in the early chapters. This mega-cap has more room to run.
Among the IT names, TCS deserves a spot on any watchlist after breaking above $100 for the first time last year. The digital revolution is still gaining steam globally, and TCS happens to be one of the sector leaders at executing that transformation for clients. Cloud migration, blockchain, cybersecurity – you name it, and TCS is making all the right moves to capitalize on those key tech trends.
Bull or bear, no portfolio is complete without at least one or two of these durable NIFTY brands primed to build on 2023’s momentum well into 2024. Do your research and happy hunting for your next multibagger!
Sensex Today Nifty
After Friday’s mixed finish, the bluechip indices looked to steadier ground on Monday. The Sensex kicked off the session firmly in the green, building on its minor gains from last week’s close. By mid-morning, it was hovering around the 63,000 level, up over half a percent.
The Nifty also seemed keen to rebound after ceding ground late on Friday. It briefly topped 18,700 in early trade before paring some gains. Still, overall sentiment was holding steady as dip buyers emerged to support.
Encouragingly, the breadth of buying looked healthier. A fair number of midcap and smallcap stocks were joining in, not just the heavy bluechips propping things up. Even sectors that struggled last week like IT and banks were finding bids.
Of course, with ongoing macros anxiety about inflation, geopolitics and slowdown, it’s too soon to call an outright trend reversal. But for now, the market seems content to build on the resilience we’ve seen over the past month. As long as 18,500 acts as a solid floor for the Nifty, the technicals remain relatively constructive too.
Plenty more talking points still lie ahead this week, from key outcomes to more macro data. But this bounce at least offers some reassurance we’re not headed straight back down in a hurry after November’s steep fall. Fingers crossed the positive tone holds as we start December.
