The week gone by which had two days in outgoing 2024 and three days in 2025 was choppy and volatile and reminding all of what a turbulent and volatile year 2024 was. The high of the year was made in September, and it was a slow and gradual downside over the next quarter. We have ended around midway as far as gains for the calendar year are concerned. Its also the lowest gains on the benchmark indices since covid in March 2020. The week saw the indices gain on two of the five trading sessions and lose on three. Thursday saw a big jump where benchmark indices gained about 1.8% and losing almost half of it on Friday. Welcome start to the new calendar year as far as volatility is concerned.
BSESENSEX gained 524.04 points or 0.67% to close at 79,223.11 points while NIFTY gained 191.35 points or 0.80% to close at 24,004.75 points. The broader indices like BSE100, BSE200 and BSE500 saw gains of 1.06%, 1.10% and 1.16% respectively. BSEMIDCAP was up 1.32% while BSESMALLCAP gained 1.94%.
The Indian Rupee was under renewed pressure and lost 24 paisa or 0.28% to close at Rs 85.77. Dow Jones was a mixed bag and lost on three of the four trading sessions. A sharp recovery on Friday, saw it recover losses suffered during the week. Dow closed with losses of 260.08 points or 0.60% to close at 42,732.13 points.
In primary market news we saw four listings with three of them on Monday the 30th of December and one on Tuesday the 31st of December. We also had one issue from Indo Farm Equipment Limited which caught the fancy of investors and was very heavily subscribed. The issue was subscribed 229.68 times with QIB portion subscribed 242.4 times, HNI portion subscribed 503.83 times and Retail portion subscribed 104.92 times. The appetite for new paper seems never ending and one wonders what needs to happen to upset or puncture this enthusiasm.
There are two primary issues in the week ahead. The first is from Standard Glass Lining Technology Limited which is tapping the capital markets with its fresh issue to raise Rs 210 crores and an offer for sale of 1,42,89,367 shares in a price band of Rs 133-140. The issue would open on Monday the 6th of January and close on Wednesday the 8th of January. This would be the first issue for calendar year 2025.
The company is a specialized engineering equipment manufacturer in India with in-house capabilities to manufacture all the core specialized engineering equipment required in the active pharmaceutical ingredient (“API”) and fine chemical products manufacturing process.
The second is from Quadrant Future Tek Limited which is tapping the markets with its fresh issue of 1 crore shares totaling Rs 290 crores at the top end of the price band of Rs 275-290. The issue opens on Tuesday the 7th of January and closes on Thursday the 9th of January. The company has just received a large order from the Indian Railways for enhanced railway safety and operations under the ‘KAVACH’ program. As this is a new order, the company needs to demonstrate its execution skill sets over the next 12 months.
The performance of the newly listed entities was a mixed bag with one issue trading below par at the end of the week while one other registered small gains looking at the market mood. The other two saw gains of close to 46% and 84% respectively.
The period ahead would continue to remain volatile and choppy. There are three events coming up in the next 25 days. The first is the results season for Quarter 3 for the period October to December. The second is US President assuming office and then issuing orders on a host of trade issues, some of which would be positive and some negative for India. The third is the budget to be declared on Saturday the 1st of February. All of these events have the potential to keep the market momentum going and they would give the markets a positive spin in the coming days. A note of caution however is that currently the markets seem to lack the steam to run away in a tearing hurry. It would be more of a case of two steps forward and one step backwards. A slow and calibrated approach with markets moving up as the events unfold.
The first levels of resistance for the markets would be levels of 24,500 points on NIFTY and 80,700-80,800 points on BSESENSEX. This should be a good enough target for the week ahead. On the support side, levels of 23,700 on NIFTY and at 78,300 on BSESENSEX would act as strong supports. The strategy would be to look at large cap stocks as they would be the ones which are the first of the block. FPI buying would come in them and that would move markets. Further one small secret, the large cap companies tend to declare results faster than the rest of the markets.
Trade cautiously.
