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Benchmark Indices ended the first week of 2024 with minor losses and the midcap index ended the week with gains for the second consecutive week. Sectoral indices ended the week on a mixed note, out of 12 sectors eight rose while four declined. The realty sector was the top gainer gaining more than 7%.

India’s Manufacturing PMI fell 18 months low to 54.9 in Dec 2023 amid both new orders and output growth softened. The sector still strongly expanded despite a loss of growth momentum. The outlook for the future looks positive. India’s Services PMI in December stood at 3 months high of 59. It is expected that the strong demand to continue amid better customer relationships and advertising.

On the global front, the US Fed held the interest rates steady at 5.25%-5.5% and saw inflation cooling but aimed at keeping the rate high for some time before the cuts expected in 2024. The US manufacturing sector declined in December amid factory employment improvement and a modest rebound in production. The US economy is expected to face some challenges in 2024 due to a surge in inflation and high interest rates could have an impact on GDP growth rates.

The market will react to the domestic and global macroeconomic data, global bond yield, crude oil inventories, movement of the dollar index, and FII and DII investment activities. Upcoming events for the next week will impact the market such as US trade balance, API Weekly crude oil, crude oil inventories, US inflation, US Initial Jobless claim, Fed balance sheet, China Inflation, UK GDP, trade balance, India inflation and forex reserve should be watched.

The large-cap segment is one area that has underperformed relative to broader markets in 2023. It is expected that large-cap may outperform small and mid-cap this year.

Domestic benchmark indices extended a rally to Friday's trade led by gains in banks and IT stocks. BSE Sensex reclaimed the 72,000 mark while Nifty50 topped 21,700 level. Nifty settled the day at 21710.80 after making a day low at 21629.20 and Sensex ended the day at 72026.15.

In technical analysis, Nifty is forming new higher highs daily, with identified support levels at 21,500 and 21,400. Immediate resistance is anticipated at 21,800 and 21,900.

Shifting attention to Bank Nifty, a break above 48,500 may lead to further upside, targeting 49,000. Conversely, a crucial support level is at 47,500, and there's a possibility of the price remaining sideways in the range of 47,500 to 48,500.