Global cues remain mixed as Asian markets display varied trends, and US markets closed in red ahead of Thanksgiving
The Indian stock market experienced a mixed trading session on Thursday, November 28, 2024, as benchmark indices began on a muted note amid uncertain cues from global markets. The session saw significant volatility, with the Sensex and Nifty shedding substantial points while the broader market indices outperformed. Here’s a detailed analysis of the day’s market trends, sectoral performances, and global cues.
Market Performance
Benchmark Indices
The BSE Sensex fell sharply by over 700 points, hovering near the 79,500 level, marking one of its steepest intraday declines in recent weeks.
The NSE Nifty was down by nearly 200 points, trading close to the critical 24,100 mark, reflecting a bearish sentiment in the market.
Despite the overall weakness, a few frontline stocks managed to stay in the green, providing some relief to investors. Among the Sensex 30, notable gainers included:
Hindustan Unilever
ITC
NTPC
HDFC Bank
In contrast, heavyweights like Infosys, State Bank of India (SBI), and Mahindra & Mahindra experienced marginal declines, dragging the indices further.
Broader Markets and Sectoral Highlights
Broader Indices
The broader market outperformed the benchmarks:
The BSE SmallCap index rose by 0.6%, driven by strong performances from stocks like:
Honasa Consumer
HUDCO
NBCC (India)
KEC International
The BSE MidCap index gained 0.2%, indicating selective buying interest among mid-tier companies.
Sectoral Performance
Nifty Media and Realty indices: Both rallied over 1%, with significant buying interest in realty stocks as positive demand trends continued to attract investor attention.
PSU Bank, FMCG, and Metal indices: These sectors recorded notable gains, supported by encouraging domestic trends and positive earnings reports.
Nifty IT index: Declined by 1%, as global concerns weighed heavily on technology stocks, reflecting cautious sentiment due to currency fluctuations and a strong dollar.
Expert Opinions
Market experts indicated that the recent volatility and consolidation phase are likely to persist in the near term. Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, highlighted the impact of foreign institutional investors (FIIs) on market trends. According to his statement:
“The cessation of relentless selling by the FIIs is a positive for the market. However, the strong dollar and global uncertainties may deter aggressive buying by FIIs. Retail investors, on the other hand, might find this an opportunity to re-enter the market cautiously.”
Key Drivers of the Day
Global Cues
Mixed trends across global markets influenced the Indian indices:
Asian Markets:
Japan’s Nikkei rose 0.5%, reflecting positive investor sentiment.
Straits Times and Kospi posted marginal gains, while Hang Seng and Taiwan indices remained in the red.
US Markets:
The benchmark indices in the US closed with losses of up to 0.6%.
Dow Jones reversed early gains to close in the red, amid subdued trading activity due to the Thanksgiving holiday.
Futures and Options Expiry
The monthly F&O expiry played a crucial role in the day’s volatility, as traders squared off their positions, adding pressure to the market.
Macroeconomic Events
South Korea’s surprise rate hike of 25 basis points added to the cautious sentiment globally, indicating monetary tightening.
The US GDP growth figures, in line with expectations, and a dip in the dollar ahead of the Thanksgiving weekend also influenced market trends.
Primary Market Action
While there were no major IPOs in the primary market, activity continued on the SME platform:
Agarwal Toughened Glass India IPO opened for subscription on Thursday.
Abha Power and Steel and Apex Ecotech continued to accept bids on their second day.
Rajputana Biodiesel IPO was set to close for subscription today.
Shares of Rajesh Power Services (SME), which recently concluded its IPO, were slated for allotment.
These developments underline the sustained interest in small and medium enterprises, with investors exploring opportunities in niche market segments.
Notable Stock Performances
Hindustan Unilever and ITC:
FMCG giants like Hindustan Unilever and ITC led gains, supported by strong demand trends and robust quarterly earnings.
NTPC and HDFC Bank:
NTPC’s continued performance, along with HDFC Bank’s resilience, helped stabilize the indices to some extent amid broader market weakness.
Infosys and SBI:
Technology and banking heavyweights faced minor corrections, as global uncertainties weighed on investor sentiment.
Adani Group Stocks:
The Adani Group companies continued their impressive run, building on gains from the previous session.
Goldman Sachs’ Gold Prediction
On a global note, Goldman Sachs projected that gold prices could reach $3,150 per ounce by December 2025, citing its value as a hedge against inflation and geopolitical risks. This bullish case scenario represents a potential 19% upside from current levels and could attract investors seeking safe-haven assets amid market uncertainties.
Investor Takeaways
Short-Term Outlook: The market is expected to remain in a consolidation phase, with mixed cues from global events and the strong dollar potentially dampening aggressive buying by FIIs.
Opportunities in Broader Markets: SmallCap and MidCap stocks outperformed, presenting selective opportunities for investors.
Sectoral Rotation: Gains in sectors like Media, Realty, FMCG, and Metals indicate that sectoral rotation remains a dominant theme.
Cautious Optimism: Retail investors might see this as an opportunity to re-enter the market, but experts urge caution given the looming uncertainties around global trade and Trump’s policies.
Conclusion
The Indian stock market on November 28, 2024, reflected a day of mixed trends, with benchmark indices declining significantly while broader market indices displayed resilience. Sectoral performances highlighted investor preference for selective opportunities in Media, Realty, and PSU Banks. Amid the ongoing consolidation phase, global cues, including US holiday trading and South Korea’s rate hike, played a pivotal role in market sentiment.
Investors are advised to remain cautious while tracking macroeconomic indicators, global developments, and upcoming policy changes, particularly as the market navigates through volatility and consolidation. The sustained interest in the SME segment and positive trends in broader markets suggest that opportunities exist for those willing to dig deeper.
