Bullish momentum propels markets to new heights, Investor optimism thrives with robust economic indicators
The markets in the month of November have rallied consistently without pause or pull back and closed near all time high. The previous all time high of Nifty at 20222 on 15th sep’23 was surpassed on 1st dec’23 when Nifty closed at 20268. The nonstop rallied continued with even faster pace in 1st week of Dec’23 and nifty closed on 8th dec’23 at 20969 after touching 21k on intraday basis. Indian Market has seen one of the fastest rallies of 4000 points on nifty when it formed a bottom around 17k in March’23 and delivered 23% return since then and 16% on YTD basis. This can be attributed to various factors like good earnings result by Companies for 2nd quarter, global markets rally, FII & DII buying, favourable macro like GDP growth at 7.6% for 2nd quarter, falling crude prices and recent states election results in favour of ruling party. Indian market has performed very well on monthly and YTD basis along with US & Europe market rally. There are still some global geo politics events to watch out for any surprises.
Outlook for the Indian Market
Markets are stable and in uptrend. The broad based rally across large cap, mid cap and small cap has continued. Further, the sectoral rally has seen performance on rotation basis like in recent month auto, realty, commodities, metals and banks have outperformed most other sectors. Even bullion market (Gold & Silver) is near all time high with decent returns. SIP inflows continue in the Indian market, the primary market is also buzzing with IPOs throughout the year with strong retail interest, subscriptions and listing gains.
Fundamental outlook: The market may sustain this uptrend for December month and consolidate around this level as most news and positive factors have been discounted. As market is heading for the year end, there is high possibility market may close the year on record high. December month has been generally positive to sideways in terms of past performance. Further rally from here seems unlikely considering the valuations. The market cap of listed Indian company has crossed 4 trillion USD and market cap to GDP ratio is around 1.2 which is on the higher end. Some rebalancing in the portfolio is advised at this stage; SIPs may continue and can invest more on healthy correction after consultation with your investment advisor.
Technical outlook: Indian market is sideways to positive on basis of technicals for this month. Nifty is currently trading above all short term and long term moving averages. The RSI is in range of 75 to 85 which indicates market is moderately in overbought zone. The immediate target for nifty is 21000 and may face strong resistance at 21350 level. The immediate support for nifty is seen at 20500 and major support at 20000.
