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Below the Quote on Weekly Market Analysis by Mr. Ajit Mishra - SVP, Research, Religare Broking Ltd

Markets experienced a recovery over the past week, gaining nearly 2% despite mixed signals. Strong global trends and rotational buying in select heavyweight stocks contributed to a gradual rise in the indices. As a result, both the Nifty and Sensex closed near the week’s high at 22,502 and 74,005.9 respectively. Most key sectors participated in the uptrend, with realty, metal, and energy sectors leading the gains, while FMCG was the exception. Notably, the buoyancy in broader indices stood out, with the midcap index reaching a record high and gaining between 4.5% and 5.6%.

The coming week is a holiday-shortened one and market focus will remain on earnings reports, ongoing elections, and global index performance for further cues. Among the key world indices, the US benchmark index, the Dow Jones Industrial Average (DJIA), has reached a new record high and also crossed a new milestone of “40,000” mark. And, we feel their continued strength is likely to support the ongoing recovery in our markets.

Despite a continuous rise in the volatility index, India VIX, the Nifty managed to recover some of its lost ground. For the recovery to extend and approach record highs, the Nifty needs to sustain above the 22,300 level. Otherwise, profit-taking might resume, potentially retesting the support zone of 21,800-22,000. Given the selective participation of key sectors in the rotation, investors should focus on stock selection, favoring those with relatively higher strength.

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