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During the week, the market slipped below the 20-day and 50-day Simple Moving Averages (SMA), and post-breakdown, selling pressure intensified.
All BSE-listed companies collectively lost a market capitalisation of ₹19 lakh crore last week. Of the 50 Nifty stocks, 48 delivered negative returns, and 30 fell by over 5%. Only two Nifty stocks, Dr Reddy’s Laboratories and Cipla, recorded gains during the week.
The sharp sell-off in heavyweight sectors such as banking and IT, which had previously supported the market, has shifted the bias back to bearish. Weakness in the rupee, along with a relatively stronger US market performance driving outflows, is compounding the current challenges.
Persistent selling by Foreign Institutional Investors (FIIs), coupled with the hawkish tone of the US Federal Reserve, disrupted the recovery phase.
Going ahead, the coming week is shortened due to holidays, and participants will closely monitor FII flow trends and global market performance for direction. Additionally, the scheduled expiry of December’s derivative contracts may amplify volatility.
Foreign institutions continued to remain net sellers in the cash market on Friday, while their domestic counterparts were net buyers.
What do the Nifty50 charts indicate?
Nifty ended Friday’s trading session at 23,587.50, recording a sharp fall of 1.52%, and capped off the week with a staggering 4.77% decline—its largest weekly drop in 2024. The bearish engulfing pattern on the weekly chart has shifted the broader trend from positive to bearish.
The Nifty50 index has slipped below the 200 DMA, signalling further weakness in the medium term. The indicators have also turned unfavourable, with the RSI on both daily and weekly charts dipping below the 45 mark, reflecting a loss of upward momentum, said Om Mehra of SAMCO Securities.
Mehra said the support lies at the previous swing low of 23,263, a critical level that must hold to prevent deeper corrections. He further said that the index appears increasingly fragile, with the 24,200 mark emerging as a key resistance.
Ajit Mishra of Religare Broking said the November low around the 23,250 zone now emerges as the next key support, while the 23,850-24,000 range serves as a resistance zone for any recovery attempts.
Here are the stocks to watch ahead of Monday’s trading session:
– Reliance Industries arm Reliance Digital Health enters into agreements to acquire 45% stake in US-based Health Alliance Group for $10 million. The acquisition is to develop a virtual diagnostic and care platform, expanding access to healthcare for underserved communities.
– Vedanta announced revisions to its previously proposed demerger scheme, deciding to retain its base metals undertaking within the parent company. This decision follows discussions with stakeholders, including lenders, and was approved by the Board on December 20, 2024.
– UltraTech Cement: To acquire 10.13 crore shares (32.72% equity) of India Cements held by the promoters & member of promoter groups. Makes an open offer for 8.05 crore shares (26% equity) at a price of ₹390 per share from public shareholders.
– Piramal Enterprises board approves raising funds up to ₹2,000 crore via QIPs in one or more tranches.
– Fortis Healthcare acquires 7.61% stake in Agilus Diagnostics for ₹429.37 crore.
– NTPC Green Energy signs Memorandum of Understanding with Bihar Government for investments to establish renewable energy projects.
– RBI imposes monetary penalty of ₹27.3 lakh on IndusInd Bank. Charge pertaining to opening of certain savings deposit accounts in the name of ineligible entities was sustained.
– Aurobindo Pharma arm CuraTeQ Biologics receives marketting authorisation from UK’s Medicines and Healthcare products Regulatory Agency (MHRA) for Bevqolva. Bevacizumab is used in the treatment of multiple cancers including metastatic colorectal cancer.
– RBI imposes monetary penalty of ₹20 lakh on Manappuram Finance. Inspection of financial position as on March 31, 23.non-compliance with RBI directions & related correspondence.
