Market Performance Overview
The Nifty 50 index faced another turbulent week, marking its sixth consecutive day of losses, as adverse global cues weighed heavily on investor sentiment. During Thursday’s session, the Nifty dropped 26 points to close at 23,533, while the Sensex fell by 111 points, settling at 77,580. Both indices registered a 2% decline over the week, marking two weeks of continuous negative returns. Sector-wise, only the Nifty IT index managed to avoid losses, while PSU Bank and Metals sectors experienced significant declines of 5% each. Out of the 50 Nifty stocks, 42 ended in the red, with Britannia, Asian Paints, and Apollo Hospitals leading the losses.
Midweek trading saw limited price movement, although the index did recover slightly from its Thursday low of 23,484. Analysts predict that if Nifty slides below the 23,500 mark, it could face further declines, potentially testing support levels between 23,200 and 23,000. Notably, the index has already corrected over 10% from its record high of 26,276, reached in September 2024.
Market Sentiment and Technical Analysis
Market participants remain cautious as the upcoming week will be shortened by a holiday, shifting focus from earnings to Foreign Institutional Investor (FII) flows. To date, FIIs have sold a net amount of ₹1.4 lakh crore in the cash market and have maintained a consistent selling pattern throughout October and into November. On November 14 alone, FIIs net sold shares worth ₹1,850 crore, while Domestic Institutional Investors (DIIs) offset this with net purchases of ₹2,482 crore.
Technical analysts note that Nifty 50’s position below the 200-day Exponential Moving Average (EMA) at 23,540 is a point of concern. According to Nagaraj Shetti of HDFC Securities, although Thursday’s session hinted at a slowdown in negative momentum near the 200-day EMA, more robust evidence is needed for a potential upward reversal. The index formed a long bearish candle on the weekly chart, signaling possible support at 23,300, which aligns with an intermediate ascending trend line. Rupak De of LKP Securities mentioned that the gravestone doji pattern seen on Thursday points to a “sell on rise” strategy, reinforcing a bearish outlook if the index fails to stay above the key EMA level.
Bank Nifty and Stock Movements
The Bank Nifty index opened with minor fluctuations before gaining positive momentum to close at 50,180. Analysts highlight the importance of the 200-day EMA support at 49,900. Hrishikesh Yedve from Asit C. Mehta Investment Intermediates emphasized that if the index respects this support, it could witness a pullback towards 50,500-50,600. Conversely, Amol Athawale from Kotak Securities warned that a drop below the 49,750 level could shift the sentiment and drive the index to 49,300-49,000.
In the derivatives market, Nifty 50’s November futures saw a 2.1% increase in Open Interest, trading at a 69-point premium. The Put-Call ratio rose to 0.88, signaling a moderately bearish stance. Fresh long positions were recorded in Eicher Motors and UPL, while PI Industries and Tata Consumer witnessed short positions. Noteworthy stock updates included a positive joint venture announcement from Reliance Industries and Disney, a reduction in gas supply reported by IGL and Adani Total Gas, and financial updates from companies like Honasa Consumer and Delhivery. Cyient expanded its automotive sector partnership, and Nureca entered a distribution agreement with Zepto.
This week’s developments suggest a continued cautious outlook as Nifty 50 navigates global uncertainties and domestic market pressures.
