The Week gone by showed how long a week could be in the stock market. It was never ending and shook the market to its core. It lost on every trading session of the week and at the end of it, it was down a massive 4,091 points on BSESENSEX and 1,180 points on NIFTY. Something not witnessed in recent times and surely our new investors who have joined the markets in large numbers post-covid since March 2020, would find this unheard of. The impact of Friday the 13th is clear to all and what was being talked about as the Santa rally, has instead turned out to be the continuation of the discount sale on Dalal Street. Nothing was spared and everything was red in tune with the color of the season. BSESENSEX lost 4,091.53 points or 4.98% to close at 78,041.59 points while NIFTY lost 1,180.80 points or 4.77% to close at 23,587.50 points. The broader markets saw BSE100, BSE200 and BSE500 lose 4.82%, 4.68% and 4.53% respectively. BSEMIDCAP was down 3.24% while BSESMALLCAP was down 3.17%.
The Indian Rupee was under pressure and lost 27 paisa or 0.23% to close at Rs 85.02. Dow Jones had a torrid time in the week gone by. The US FED cut interest rates on expected lines by 25 basis points but indicated that there would be no more than two cuts in the coming 2025. This spooked the markets and they were down very sharply post the meeting on Wednesday. Sanity did return on Friday when they recovered quite smartly but not enough to recoup the losses. Dow was down 987.20 points or 2.25% to close at 42,840.86 points.
The primary market is very buoyant these days and bunching of issues has become the norm. Wednesday saw the listing of as many as three issues and currently as many as five issues have opened on Thursday the 19th of December and would close on Tuesday the 24th of December. One wonders what the views of the regulator on such bunching are? They would list on the same day, Monday the 30th of December and unfortunately the two exchanges combined do not have the infrastructure to host five listings at one time.
The first of the listing was from One Mobikwik Systems Limited which had issued shares at Rs 279. The share closed day one at Rs 530.30, a gain of Rs 250.30 or 89.71%. It closed lower at Rs 488.40, a gain of Rs 209.40 or 75.05%.
The second share to list was Vishal Mega Mart Limited which had issued shares at Rs 78. The share closed day one at Rs 111.95, a gain of Rs 33.95 or 43.52%. By the end of the week the share surrendered some gains and closed at Rs 101.11, a gain of Rs 23.11 or 29.63%.
The third share to list was Sai Life Sciences Limited which had issued shares at Rs549. The share closed day one at Rs 765.30, a gain of Rs 216.30 or 39.39%. By close of trading at the weekend, the share had slipped to Rs 702.20, a gain of Rs 153.20 or 27.91%.
The fourth share to list was Inventurus Knowledge Solutions Limited which had issued shares at Rs 1,329. The share listed on Thursday the 19th of December and closed at Rs 1,960.25, a gain of Rs 631.25 or 47.49%. It lost ground on Friday and closed at Rs 1,887.50, a gain of Rs 558.50 or 42.02%.
The fifth and final share to list was International Gemmological Institute India Limited which had issued shares at Rs 417. The share which listed on Friday, made a high of Rs 525 and closed at Rs 470.15, a gain of Rs 53.15 or 12.75%.
The week ahead sees a total of nine issues that would close during the week. The first lot would see five issues which have opened on Thursday the 19th of December and would close on Monday the 23rd of December. These are from Dam Capital Advisors Limited, Concord Enviro Systems Limited, Sanathan Textiles Limited, Mamata Machinery Limited and Transrail Lighting Limited. The second lot consists of three issues which have opened on Friday the 20th of December and would close on Tuesday the 24th of December. These are from Senores Pharmaceuticals Limited, Ventive Hospitality Limited and Carraro India Limited.
The final issue which would open on Monday the 23rd of December and close on Thursday the 26th of December. This issue is from Unimech Aerospace & Manufacturing Limited. This bunching of issues in December is something which I have not witnessed in a very long time. Clearly there is something which is not being understood. The narrative that accounts would have to be updated is a very old excuse and it happens every time. There is nothing new in that logic whatsoever. Incidentally, post listing within 21 days, any results overdue have to be declared.
Coming to the markets, FPIs were very aggressive sellers in the month of October 24 and have actually been small buyers so far in the month of December. Further if one were to look at the calendar year 2024 so far in totality, they have done nothing much, buying on a net basis a little over Rs 6,000 crores.
The week ahead has a holiday on Wednesday on account of Christmas which is followed by December futures that would expire on Thursday. The present level of NIFTY at 23,587.50 points sees the series down by 326.65 points or 1.37%. With last week’s sharp fall, the series has tilted in favor of the bears. With three days to go, it will be a herculean task to pull it back. It should be noted that while in this month FPIs are net buyers they have played very well on Friday the 13th of December and caused the sharp movement in the markets on that day and post that day.
Expect markets to trade lower as we move towards the mid-week holiday. The advantage that FPIs have will be fully exploited and somewhere between the holiday and expiry or putting it more wider time frame, during the week we should see markets establishing a bottom and moving up. Levels of support would be 23,200-23,400 on NIFTY and at 76,800-77,400 on BSESENSEX. What would move is the next question. The last leg has seen the benchmark indices bear the brunt of the beating. It would therefore be natural to expect the large caps to be the biggest beneficiary. In terms of resistance levels of around 24,100-24,250 points would be the first hurdle.
We are in the final stages of pain and with budget expectations which would start playing out over the next month, expectation of third quarter results keeping the market active, expect a better January 2025 ahead.
Trade cautiously over the last six trading sessions of calendar year 2024 with four in this week and two in the next week.
Merry Christmas.
