Nifty 50 on 31 December: Recap
Wishing all our readers a very Happy New Year!
As 2024 drew to a close, markets grappled with significant challenges: geopolitical instability, underwhelming Q2 earnings, foreign institutional investor (FII) outflows, volatility from central bank rate cuts, and tariff concerns over Donald Trump’s policies.
Read this | Stock market today: Nifty 50, Sensex close flat, wrap 2024 with modest gains; mid, small-caps outperform
Indian markets started the final trading day of the year on a grim note, with a sharp drop below Monday’s lows dealing a blow to bullish sentiment early on. However, a spirited recovery by the close rekindled hope for the bulls, offering a glimmer of optimism as the year ended.
Indian stock markets: Way forward
As highlighted in the previous report, market uncertainty at the open pushed indices lower. “…Put Call Ratio (PCR) is moving above 1 indicating that there is some Put writing at important supports around 23,500 hinting at a possibility of some upside that can emerge from lower levels.”
Read this | Top sectors to pick and avoid in 2025
Tuesday’s test of these levels has prompted a reassessment of strategies, with trends continuing to signal room for further decline. That said, robust put writing on Tuesday has created a support floor, limiting the downside.
With the Nifty spot still trading below the critical 200-DMA zone at 23,900, any signs of bullishness must be approached with caution and a limited objective. It’s advisable to remain vigilant with long positions, as the markets are not yet out of the woods.
Three stocks to trade, recommended by NeoTrader’s Raja Venkatraman:
• Jio Financial Services Ltd (JIOFIN): Sell below ₹297, stop ₹303, target ₹287
Shares of non-banking financial companies (NBFCs) have come under significant pressure, with trends showing a sharp downward momentum. Tuesday’s breakdown failed to trigger a recovery, and the recent flag pattern breakdown has intensified the selloff. The inability of prices to hold during the latest reaction further underscores the mounting pressure on these stocks.
Read this | What RBI has in store for banks and NBFCs: New regulation, lens on unsecured loans
• ITC Ltd (ITC): Buy above ₹485, stop ₹478, target ₹495
The V-shaped recovery highlights that the FMCG sector is showing some improvement as buying interest is seen helping prices move above value resistance zone around ₹480. With steady buying interest developing in this counter, poised at heading beyond the cluster highs one can consider going long.
• Alembic Pharmaceuticals Ltd (APLLTD): Buy at ₹1070, stop ₹1050 target ₹1100
Alembic Pharmaceuticals, a leader in pharma technology and a key supplier of automotive components, has been witnessing steady demand at lower levels. The consolidation on the daily charts, coupled with the formation of a long-bodied candle on Tuesday, signals the potential for sustained bullish momentum. A decisive close above the value resistance area around ₹1,050 could pave the way for further upside in the days ahead.
Also read | A new year, new trends, and five new market opportunities in 2025
Raja Venkatraman is co-founder, NeoTrader.
Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before making any investment decisions.
