16th December 2024 Pre-Market Analysis

Introduction

This report provides an overview of the recent market performance, key economic indicators, and notable stocks in both bullish and bearish situations as of December 16, 2024.

Key Points

1. Market Overview

Market Highlights

1. GIFT Nifty: Trading weak, indicating a negative start for Indian markets.
2. Indian Indices Performance:
   • Session Volatility: Highly volatile session.
   • Recovery: Indices rebounded over 2% from the day’s lows.
   • Driving Factors:
     • Easing retail inflation.
     • Industrial growth at 3.5% in October, a three-month high.
   • Sectoral Leaders: Auto, Banking, Telecom, and FMCG sectors led the recovery.
3. Asian Markets:
   • Trading in narrow ranges early Monday.
   • Awaiting Chinese economic data and regulators’ vow to stabilize markets.
4. US Market Recap:
   • Friday Session: Subdued trading near unchanged levels.
   • Weekly Performance:
     • S&P 500 and Dow declined.
     • Nasdaq posted its fourth consecutive week of gains.
5. US Treasury Yields:
   • 10-Year Treasury: Down 22 basis points to 4.38%.
   • 2-Year Treasury: Down 15 basis points to 4.23% (early Monday).
6. Asian Currencies:
   • Mostly traded lower in early Monday trade.
7. Gold Prices:
   • Marginally up ahead of the Federal Reserve’s interest rate decision.
8. Global Central Bank Decisions:
   • Major announcements expected this week from:
     • US Federal Reserve.
     • Bank of Japan.
     • People’s Bank of China.

2. Economic Indicators

• The U. S. 10-Year Treasury yield fell to 4. 14%, and the 2-Year Treasury yield dropped to 4. 10%.
• The U. S. dollar index remained stable near 106.
• Asian currencies were mixed, led by gains in the South Korean won.
• Gold prices increased as China’s central bank resumed bullion purchases.
• The Indian rupee strengthened, reaching 84. 57 against the U. S. dollar.

3. Technical Analysis

Nifty 50 Analysis

1. Bullish Candlestick Pattern:
   • The candlestick has a long lower shadow, indicating strong buying interest.
   • Support was found near the mid Bollinger Bands.
2. Key Moving Averages:
   • The index consistently remained above key moving averages on both daily and weekly timeframes.
   • This signals a positive trend in the market.
3. Momentum Indicators:
   • Relative Strength Index (RSI): At 60.37, indicating bullish momentum.
   • MACD (Moving Average Convergence Divergence): Reflects bullish conditions, supporting upward momentum
     

     Bank Nifty Analysis

   • 1. Bullish Candlestick Pattern:
        • A bullish candlestick with a long lower shadow indicates strong buying interest at lower levels.
     2. Support Levels:
        • Found support at the mid-range Bollinger Bands.
     3. Moving Averages:
        • Rising above key moving averages, confirming positive momentum.
     4. Weekly Performance:
        • Stayed within the upper Bollinger Band range, reflecting positive market sentiment.

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4.Bullish Stocks

1. Reliance Industries:
   • Acquired a 74% stake in Navi Mumbai IIA for ₹1,628 crore.
2. Dixon Technologies:
   • Signed a binding term sheet for a joint venture with Vivo India for OEM of electronic devices, including smartphones.
   • Dixon will hold a 51% stake in the venture.
3. Biocon:
   • Received a recommendation for approval of YESINTEK from the EMA’s CHMP.
4. Lupin:
   • Acquired three trademarks from Boehringer Ingelheim to enhance its diabetes portfolio.
5. Aurobindo Pharma:
   • Subsidiary CuraTeQ Biologics received a positive opinion for its biosimilar Zefylti from the EMA.
6. Premier Explosives:
   • Signed an MoU with Global Munition for a joint venture to manufacture defense and aerospace products, with a 51:49 stake split.
7. Max Financial:
   • Received approval for a name change to Axis Max Life Insurance from the Registrar of Companies.
8. JK Paper:
   • Announced a Scheme of Arrangement to consolidate operations, including:
     • Merging subsidiaries.
     • Acquiring a 60% stake in Radhesham Wellpack Pvt. Ltd.
9. Aeroflex Industries:
   • Approved raising up to ₹400 crore via a Qualified Institutional Placement (QIP).
10. Afcons Infra:
    • Received a Letter of Award (LoA) for a ₹1,007 crore project from the Madhya Pradesh Metro Rail Corporation.
11. Bharat Forge:
    • Subsidiary Kalyani Strategic Systems acquired a 25% stake in Edgelab S.p.A. for €2,500,000.
12. Elcid Investments:
    • Applied to the RBI for registering its NBFC as a Type-I NBFC-ND.

5. Stocks to Watch
Berish Stocks:

1. JP Power Ventures:
   • Andhra High Court stayed the Mines Department’s demand of ₹1,334 crore.
2. JSW Energy:
   • Filed a petition with MERC to recover invoices from Maharashtra State Electricity Distribution Company.
3. Sun Pharma:
   • Mumbai Customs Department imposed a redemption fine of ₹40 lakh due to confiscated imported goods.
4. Indigrid:
   • Esoteric II PTE sold 2.01 crore shares at ₹138 per share.
5. MTAR Technologies:
   • Promoters offloaded shares on December 12:
     • Kavitha Reddy Gangapatnam: Sold 40,000 shares.
     • D. Anitha Reddy: Sold 7.9 lakh shares.
     • Usha Reddy Chigarapalli: Sold 7.05 lakh shares.
6. Shilpa Medicare:
   • Promoter Priya Inani sold 1 lakh shares on December 12.
7. Wardwizard Innovations and Mobility:
   • Promoter Garuda Mart India sold 10 lakh shares on December 11.
8. Salasar Techno Engineering:
   • Promoter share sales:
     • Shikhar Fabtech Pvt.: Sold 4.96 lakh shares (December 9–10).
     • Shikhar Gupta: Sold 1.99 lakh shares on December 9.
9. Stocks in F&O Ban:
   • Granules, Hindustan Copper, Metropolis Healthcare, Manappuram Finance, National Aluminium, PVR Inox, RBL Bank, and SAIL.
10. Stocks Removed from F&O Ban:

• None.

6. Foreign Institutional Investors (FII) and Domestic Institutional Investors (DII)

• FIIs were net sellers with a gain amounting to Rs 2,335.32. 31 Cr.
• DIIs were net buyers with a loss amount of Rs –732.20. 06 Cr.

Conclusion

The market is set for a cautious start with mixed signals from international markets and local economic indicators. Investors should continue to monitor key stocks and market indices for potential movements in both bullish and bearish directions, keeping an eye on upcoming economic data and geopolitical events.