Indices are close to their record highs again and have virtually recovered all losses sustained at the beginning of the week. Broader markets have also seen buying but analysts cautioned against betting on penny stocks.
“Retail investors are committing mistakes: Many are buying low-grade stocks and there are many instances of stopping SIPs. These are unhealthy trends,” said VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services.
Factors driving markets
Brexit deal likely: Britain and the European Union appeared close to clinching a long-elusive trade agreement on Wednesday, raising hopes that they were now set to avoid a turbulent economic rupture on New Year’s Day.
More restrictions to come: The British government on Wednesday said huge swathes of England would be placed under its strictest COVID-19 restrictions as a highly infectious virus variant sweeps the country.
Mixed macro data: Data on Wednesday showed the number of Americans filing first-time claims for unemployment benefits unexpectedly fell last week, though remained elevated. Data also showed consumer spending slipped in November for the first time since the recovery from the coronavirus recession started in May and personal income fell 1.1 per cent.
How are bluechips doing
After opening in the green, benchmark indices climbed further. At 9.44 am, BSE flagship Sensex was up 323 points or 0.70 per cent to 46,767. NSE benchmark Nifty followed and climbed 99 points or 0.73 per cent to 13,701.
“The Nifty has nudged the 13,700 level upon opening. Since it is a truncated week, we would need to evaluate the Nifty on Monday. If we are able to keep above the 13,700 level, we could go up to 13,850 and then 14,000. A strong support for the market has now been created at 13,100. As long as that holds, we are in bullish terrain,” said Manish Hathiramani, proprietary index trader and technical analyst, Deen Dayal Investments.
In the 50-share pack Nifty, ONGC was the biggest gainer, up 3.91 per cent. Tata Motors, Hindalco, GAIL, Bharti Airtel, BajajAuto, Indian Oil, Coal India and JSW Steel were among other gainers.
Infosys was the top loser in the pack, down 1.03 per cent. Asian Paints, Wipro, Cipla, Dr Reddy’s Labs and TCS were other losers.
Broader markets
Broader market indices also traded with gains outperforming their headline peers in morning trade. Nifty Smallcap gained 1 per cent while Nifty Midcap rose 0.79 per cent. Broadest index on NSE, Nifty 500 was up 0.81 per cent.
Vakrangee, P&G Health, IRB Infra, Gujarat State Petronet, Dhani Services and Future Retail were among major gainers from the space while Vodafone Idea, Mphasis, Bharat Forge, Lemon Tree Hotels, Cyient and Suven Pharma were under selling pressure.
Global markets
MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.14 per cent. Australian stocks advanced by 0.57 per cent, while Tokyo shares rose 0.43 per cent. US stock futures edged up by 0.11 per cent.
Chinese stocks rose 0.02 per cent, but Alibaba Group Holding Ltd slumped 6.28 per cent, its biggest daily drop in six weeks, after China’s market regulator said it will investigate the tech giant for suspected monopolistic behaviour.
