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Understanding the Recent Stock Market Surge: A Simple Breakdown 29 Nov 2023

Nifty prediction | bank nifty prediction | stock market rallied, why?

Recently, the stock market, including Nifty and Bank Nifty, experienced a significant boost. Here’s a straightforward breakdown of why this happened:

  1. Buyers in Action:
    • Over the past three days, big investors known as Foreign Institutional Investors (FIIs) and Domestic Institutional Investors (DIIs) have been buying a lot.
    • In November, FIIs had been selling quite a bit, but in the last few days, their selling reduced to around 2352 crore. On the flip side, DIIs bought around 13542 crore during this time.
  2. Nifty’s Journey:
    • Nifty, one of the key market indices, began its upward movement from 19577.
    • It appears that after this point, selling slowed down, and a process called “short covering” started. This helped push Nifty to 20089 today.
  3. Bank Nifty’s Impact:
    • The upward trend was not just about Nifty; Bank Nifty played a crucial role.
    • Bank Nifty found support at 44011 and surged to an impressive 44628 today, surpassing expectations.
  4. Finnifty Stocks Join In:
    • Other important stocks, referred to as Finnifty stocks, followed suit, reaching a significant level of 20005 today.
  5. Concerns with Crude Oil and Currency:
    • There are some challenges, though, especially with the rising prices of crude oil, which went above 6300.
    • Additionally, the exchange rate between the US Dollar and Indian Rupee (USDINR pair) has been consistently above 83, posing concerns.
  6. Tech and Banking Giants Shine:
    • Today, Wipro’s stock gained nearly 3 percent, and other big tech companies like Tech Mahindra, HCL Tech, Infosys, and TCS also saw positive movements.
    • Banking giants like HDFC Bank and Reliance also showed positive trends.
  7. Global Factors at Play:
    • One of the main reasons for this market rally is the belief that the Federal Reserve (FED) might not increase interest rates soon. There’s even speculation that a rate cut could happen.

In simpler terms, the recent surge in the stock market is due to a combination of increased buying activity, positive movements in key indices like Nifty and Bank Nifty, and optimism driven by expectations of a pause in interest rate hikes globally. However, challenges, such as high crude oil prices and currency dynamics, are still on the radar.