Weekly stock market wrap: The Indian stock market witnessed a rollercoaster week as the domestic equity benchmark indices, Sensex and Nifty, hit fresh life highs before facing a significant sell-off.

Market overview

The Sensex and Nifty reached unprecedented levels of 73,425 and 22,124, only to retract gains and close the week with losses of 1.6 per cent and 1.5 per cent, respectively. BSE Midcap and Smallcap, on the other hand, outperformed, rising 1.3 per cent and 0.3 per cent. Notably, PSU and Oil & Gas stocks displayed strong momentum, gaining 4.9 per cent and 4.3 per cent, respectively.

Sectoral highlights

PSU and Oil & Gas stocks were the week's standout performers, with gains of 4.9 per cent and 4.3 per cent. Railway stocks also saw an upward trend ahead of the budget, driven by expectations of healthy order inflows. The ongoing earnings season influenced stock-specific actions, with UltraTech, HUL, and HDFC Bank results taking center stage.

Technical analysis

Nifty's sharp sell-off after hitting an all-time high prompted a closer look. The index closed below its 20-day EMA level, signaling potential consolidation. SBI Securities advises market participants, especially traders, to play it safe and become aggressive only after clear direction and momentum emerge. Any sustainable move below 21,250 may lead to further selling pressure, while a move above 21,850 would resume the northward journey.

Corporate earnings

Major corporate players reported their Q3 FY24 results:

• Reliance Industries reported consolidated revenue of Rs 2,48,160 crore, earnings before interest, depreciation, tax and amortisation (EBITDA) of Rs 44,678 crore, Profit after Tax (PAT) of Rs 19,641 crore, up 3.2 per cent,16.7 per cent, 10.9 per cent year on year (YoY).
• Hindustan Unilever reported consolidated sales at Rs 15,567 crore, EBIDTA of Rs 3,666 crore, and PAT of Rs 2,508 crore, down 0.4 per cent, 3.5 per cent, 5.6 per cent YoY.
• UltraTech Cement reported consolidated sales at Rs 16,740 crore, EBIDTA at Rs 3,255 crore, and PAT at Rs 1,777 crore, up 7.9 per cent, 39.3 per cent, 67.9 per cent YoY.
• HDFC Bank reported net interest income (NII) at Rs 28,471 crore, pre-provision operating profit (PPOP) of Rs 23,647 crore, PAT of Rs 16,373 crore, up 23.9 per cent, 24.3 per cent, 33.5 per cent YoY.

Economic updates

• Wholesale Price Inflation in December 2023: 0.73 per cent YoY, highest in eight months.
• Chinese GDP expands 5.2 per cent in Q4 CY23.
• UK Inflation at 4 per cent in December 2023.

Market outlook

SBI Securities predicts a range-bound market in the coming weeks, with Nifty expected to oscillate between 21,850 and 21,250. "The penetration with strength on either side would open gates for a trending move. Till it happens, we would suggest market participants, especially traders, play safe and become aggressive only after the markets find direction and
momentum," said SBI Securities in its weekly report.

“Any sustainable move below the level of 21250 will lead to further selling pressure in index. In that case, it is likely to test the level of 20950 in short term. While, on the upside, any sustainable move above the level of 21850 will lead to resume its northward journey,” the report added.