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There is expected to be ups and downs in the stock market this week. The market will keep an eye on factors ranging from retail and wholesale inflation rates to foreign investment. On Friday, the Monetary Policy Committee had kept the repo rate as it was, but reduced the CRR by 0.5%, its effect can also be seen in the market this week.
According to Harshubh Mahesh Shah, Founder of Wealth View Analytics, the main direction of the market is currently negative. There may be a decline in the market this week. Siddharth Khemka, Head of Wealth Management, Motilal Oswal Financial Services, expects the market to remain bullish due to CRR cut and withdrawal of FIIs.
5 factors which will decide the market movement this week…
1. Retail inflation: Estimate of decline in inflation in November
Inflation figures for the month of November will be released on December 12. Most economists expect inflation to decline in November. Due to costlier food items, retail inflation increased to 6.21% in October. This is the highest level of inflation in 14 months. The inflation rate in August 2023 was 6.83%.
In September also, this rate had reached 5.49% due to the cost of vegetables. Food items contribute about 50% to the inflation basket. Its inflation increased from 9.24% to 10.87% on month-on-month basis. Rural inflation increased from 5.87% to 6.68% and urban inflation increased from 5.05% to 5.62%.
2. Industrial Production: Figures to be announced on December 12
Apart from inflation, industrial and manufacturing production data for October will also be announced on December 12. At the same time, data on bank loan and deposit growth for the fortnight ending November 29 as well as foreign exchange reserves for the week ending December 6 will be released on December 13.
3. US inflation: likely to be around 2.6%
Investors will also keep an eye on America’s inflation data for the month of November. According to economists, the inflation rate is likely to be around 2.6%. Inflation figures are also important because the Federal Reserve meeting is on December 17-18. The cut in interest rates will depend on inflation figures.
4. FII’s and DII’s: Foreign investors bought shares worth ₹11,934 crore
For the first time since mid-September, there was a positive change in FII flows on a weekly basis. Foreign institutional investors (FII’s) have made net purchases of Rs 11,934 crore in the cash segment so far in December, while selling worth Rs 1.6 lakh crore in October-November.
At the same time, domestic institutional investors (DII’s) bought shares worth a net Rs 1,792 crore in December. In the last two months they made net purchases of Rs 1.51 lakh crore. Overall, they remain buyers on a monthly basis through August 2023.
5. IPO and Listing: 6 issues opening in mainboard segment
Along with five mainboard IPOs, six issues from the SME segment are going to open for subscription. The IPOs of Vishal Mega Mart, Sai Life Sciences and MobiKwik will open on December 11, while the IPO of Rekha Jhunjhunwala-backed Inventurus Knowledge Solutions will open on December 12. The IPO of Gemological Institute is coming on 13th December.
In the SME segment, IPOs of Dhanlaxmi Crop Science, Jungle Camps India, Toss the Coin, Purple United Sales, Supreme Facility Management and Yash High Voltage will open.
Technical View: Formation of Higher High-Lower Low positive signal
Nifty continued the formation of Higher High-Lower Low for the second consecutive week, which is a positive sign. Now, the index will have to overcome 24,700-24,800 zone to further rise towards 25,000-25,200 levels, while the immediate support lies at 24,500. After this there is support of 24,350.
Sensex closed last week with a gain of 1907 points.
Last week, Sensex saw a rise of 1907 points. There was flat trading in the stock market on 6th December, the last trading day of the week. Sensex closed at 81,709 with a fall of 56 points. Nifty also fell by 30 points, it closed at the level of 24,677.
At the same time, BSE Smallcap closed at 57,050 with a gain of 342 points. Out of 30 Sensex stocks, 17 declined and 13 rose. Out of 50 Nifty stocks, 32 declined and 18 rose. In the NSE sectoral index, the metal sector closed with the highest gain of 1.23%.
