Markets in the Balance - Can Investors Weather the Post - Election Storms?

MARKET HIGHLIGHTS

 Market Synopsis       
Following Diwali week, market pressure continued as bearish sentiment dominated, driven by geopolitical tensions and a flood of news. However, the IT and PSU Bank sectors showed resilience with strong performance. By market close, the Sensex had dipped 0.07 percent to 79,486.32, while the Nifty fell 0.21 percent to 24,148.20 amid ongoing consolidation.

Q2FY25 earnings largely disappointed shareholders, especially in the metal sector, which declined over 1%, impacted by China’s economic stimulus.

This week, investor focus turned to the U.S. Presidential Election results, where a decisive Republican victory sparked positive momentum in Indian markets, lifting both the Nifty and Sensex indices by more than 1% on Wednesday after extended periods of decline. Analysts suggest that this outcome may bring both opportunities and challenges for Indian equities, particularly regarding trade tariffs, defense, immigration, and technology.

Persistent selling pressure continued as foreign institutional investors (FIIs) offloaded approximately ₹14,697.05 crore, while domestic institutional investors (DIIs) expressed confidence, purchasing around ₹8,861.70 crore. Market volatility, as measured by the VIX, decreased by 3.15% following recent rallies.

Looking ahead, uncertainty remains, with the Reserve Bank of India (RBI) under focus as it may consider rate cuts in response to the U.S. Federal Reserve’s recent 0.25% reduction.

 Market Developments 

* Trent stock experienced a 10% decline over the past two sessions due to a drop in profits. 

* Waaree Energies’ recent IPO saw its market capitalization exceed 1 lakh crore within a week, significantly enhancing shareholder value. 

* Following the US elections, the US Federal Reserve implemented a second rate cut of 0.25% within 24 hours, prompting anticipation for a response from the RBI. 

* SBI reported a 23% year-on-year increase in profits for Q2 FY25. 

* Swiggy’s IPO was subscribed 3.59 times on the final day of bidding, November 8th, following a neutral response in earlier market sessions

FII-DII DATA

Net Cash (in Rs. crores):
4 NOV-
FII- (4,329.79)
DII- 2,936.08 
5 NOV-
FII- (2,569.41)
DII- 3,030.96
6 NOV-
FII- (4,445.59)
DII- 4,889.33
 7 NOV-
FII- (4,888.77)
DII- 1,786.70
8 NOV-
FII-(3,404.04)
DII- 1,748.44

TOP GAINER-
M&M- 5.58%
Apollo Hospital- 5.54%
Tech Mahindra- 4.85% 

TOP LOSERS-
Trent – -11.89%
Coal India Ltd- -6.63%
Hindalco- -5.85%

Top Performing Sector
NIFTY IT:  3.92%

Worst Performing Sector
NIFTY REALTY:  -3.38% 

Technical Analysis 
The Indian stock market showed mixed technical indicators this past week, with notable challenges and resistance levels

Nifty 50 closes at 24,148.20 with a fall of 0.21%. Fears about global events over the weekend kept market sentiment weak and some analysts said if it didn’t hold 24,000, the index would be vulnerable to a slide. Support was seen between 23,680 and 23,800 but if broken there is further downside towards the 200-day SMA approximately at 23500. On the flip side, continued price action over 24,500 could provide some recovery potential.

The next 3 support levels are at 23916.18, 23,842, 23697.47.The RSI, which measures the magnitude of recent price changes to analyze overbought or oversold conditions, for the Nifty 50 was around 49.68 during the week, indicating a neutral stance. This level reflects a balance between buying and selling pressure, signaling no clear overbought or oversold condition

Moving averages (MA) were largely neutral, being inside the buy zone for short-term averages (5 and 10 days), but sell pressure was still apparent from longer-term MAs (100 and 200 days).