InvestorQ : What is your market view for 29 December? Do you see this rally in the Nifty and Sensex continuing?
swati Bakhda made post

What is your market view for 29 December? Do you see this rally in the Nifty and Sensex continuing?

diksha shah answered.
3 years ago

It must be said that the market has recovered phenomenally well after the sharp correction in the Nifty and Sensex on 21 December. Now, the Nifty has been up for four successive sessions, more than making up for the fall and closing an all time high. The sustained buying from institutions and building up of long positions have buoyed the markets.

The markets were excited about two key developments. On one hand BREXIT deal got finalized last week and that put an end to uncertainty. Secondly, Donald Trump signed the $2.3 trillion stimulus deal which is expected to keep the US economy ticking long after the holidays. That removes the biggest uncertainty between now and Biden taking over.

Foreign portfolio investors were net buyers in the Indian equity markets to the tune of Rs.1589 crore while DFIs sold Rs.1387 crore on 28 December. This makes the month of December at par with November in terms of FPI flows into equities. With another 3 days still to go in the month, it looks like December could get the better of November.

It was overall a positive day for the Indian markets on Monday. The Dow and the NASDAQ were nearly up by 75 basis points while the UK markets were almost flat. However, CAC and DAX appeared to celebrate the BREXIT deal with 1% gains on Monday. In early trades, the SGX Nifty is trading 35 bps higher above 13,900 levels and Asian markets could hold the key.

Coming to your question on the trajectory of the Nifty and the Sensex, I think 14,000 could now be the next important level to look at. As of now it is liquidity flowing in and stocks are getting re-priced higher. The level of 14,000 will be crucial to decide whether such a continuation of the rally is really feasible. It is time for you to be careful around 14,000.