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Weekly Market Outlook 09 December from Vinod Nair, Head of Research at Geojit Financial Services

"The market achieved an all-time high, driven by robust domestic GDP growth. Despite the RBI maintaining policy status quo, an upgraded GDP growth forecast for FY24 (6.5% to 7%) boosted investor confidence. Measures to address the liquidity deficit, including the reversal of SDF & MDF facilities, positively impacted financials, leading to a 5% gain in Nifty Bank for the week. IT, consumer, auto, and realty sectors performed well due to valuation comfort, festive momentum, and a strong uptick in residential sales. Mid & small caps continued to outperform, driven by a healthy economic outlook, strong Q2 earnings, and corrections in oil prices.

Investors should be mindful that achieving the RBI's 4% CPI inflation target may take time. Concerns arise from reduced rabi sowing and declining reservoir levels, signalling a potential rise in foodgrain prices. This impacted FMCG stocks negatively, contrasting with positive performances in most other sectors. In the upcoming data-centric week, focus will be on crucial releases, including inflation data from India and the US. Indian inflation is expected to rise, while US inflation will remain steady. Indian industrial and manufacturing production is also expected, while consensus expects expansion. However, the outcome of the awaited Fed policy meeting will be pivotal in shaping market sentiments."

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