Stock Market Update: What to Expect from the Indian Markets for the Week of October 21-27, 2024

What to Expect from the Indian Markets for the Upcoming Week of October, As we move into October 21-27, 2024, the Indian stock market is gearing up for a regular week of trading. Investors can expect uninterrupted market sessions with no scheduled market holidays except for the weekend break on October 26 and 27 (Saturday and Sunday).

However, this comes on the back of a third consecutive week of losses, raising questions about what’s in store for the days ahead.

Market Overview: Is a Turnaround Possible?

The previous trading week, from October 14-18, was anything but smooth, with the Sensex losing 616.71 points (0.75%) and the Nifty 50 dropping by 178.30 points (0.71%).

This continued a downtrend that has persisted for three weeks, marking 2024’s longest losing streak to date. Despite a rally on Friday, which saw the Sensex gain 218 points and the Nifty rise by 104 points, the broader market still closed lower for the week.

One notable positive was the performance of banking stocks, with the Nifty Bank Index surging by 805 points, supported by a positive start to earnings season and lower-than-expected slippages in the sector.

Impact on Investors: Where to Focus?

For investors, the ongoing volatility raises concerns, but there are still opportunities. Experts suggest that, while the market may remain range-bound in the short term, large-cap stocks in sectors like FMCG, agriculture, and power could offer relative stability.

• Buy-on-dips strategy: For short- to medium-term investors, focusing on quality large-cap stocks and growth sectors could pay off. The key here is to selectively pick stocks with strong fundamentals that are more likely to withstand market fluctuations.
• Caution on small- and mid-caps: With muted Q2 earnings expectations and external pressures, such as geopolitical tensions, small- and mid-cap stocks might carry more risks for now. As always, diversification remains crucial.
• Where to Focus: Investors should continue to monitor global cues and domestic earnings reports. While short-term volatility is likely, long-term fundamentals, particularly in sectors like infrastructure and digital growth, remain strong.

Future Outlook: Diwali Rally on the Horizon?

As Diwali approaches, traditionally a time for positive market sentiment, there are growing expectations of a potential rally.

This would typically begin with Dhanteras on October 29 and last through to Bhai Dooj on November 3.

Investors are hopeful that the festive period will spur a recovery after the current slump.

However, challenges remain. Persistent selling by Foreign Portfolio Investors (FPIs), coupled with muted domestic demand and concerns over input price volatility, could keep market gains in check.

There’s also the added uncertainty from geopolitical factors and the upcoming US presidential election, which has boosted safe-haven assets like gold.

On the technical front, analysts warn of key support and resistance levels that traders should keep an eye on:

• Support levels: A fresh selloff could be triggered if the Nifty falls below 24,650 and the Sensex slips under 80,800. In such a case, the Nifty could drop further to 24,500, while the Sensex could test 80,300.
• Resistance levels: If the Nifty holds above 24,900 and the Sensex above 81,500, the market may gain momentum, pushing up to 25,000 and 82,200.

Opinions: What Analysts Are Saying

Analysts across the board agree that the market’s future depends heavily on upcoming corporate earnings reports and external global cues.

However, the long-term outlook for the Indian economy remains positive, with increased capital expenditure and stable growth prospects.

Indian markets remain resilient in the long term. Investors should focus on defensive sectors and avoid chasing short-term gains in speculative stocks.

Also, read | Global Economic Challenges: Navigating High Debt and Slowing Growth

Technical Charts: Key Market Trends

Adding a chart that shows the performance of the Nifty and Sensex over the last month would provide readers with a clearer picture of the market’s current trend.

A bar graph comparing the weekly gains and losses for sectors like FMCG, banking, and IT could also enhance the article by visually summarizing the sectoral performance.

Table: Recent Performance of Key Indices

Bottom line:

With the market heading into a crucial phase before Diwali, investors need to stay Updated with Market Insights. Keep a close watch on earnings reports, global developments, and sectoral trends.

In conclusion, while the near-term market might remain volatile, long-term investors should continue to focus on sectors with solid growth potential.

As always, a well-diversified portfolio and a clear strategy will be the key to navigating the turbulent times ahead.

Source:-

1. goodreturns.in