WEEKLY TRENDSETTER (DEC 27,2024)
| 2024 | DEC 13 | DEC 20 | Ch % |
| NIFTY | 24768 | 23587 | -4.77 |
| BANK NIFTY | 53583 | 50579 | -5.61 |
| USD/INR | 84.80 | 85.02 | 0.26 |
MARKET REVIEW-The market was on a sell mode right from the beginning of the week. Critical levels were breached with ease as selling pressure mounted. Cues from US did not help and the rupee also touched an all-time high of 85.34 as relentless selling pressure from FII s took heavily toll on the markets and currency alike. The Fed ‘s rate cut followed by mellowing down guidance for future rate cuts saw the US markets sinking. Going into New Year, some Santa Claus rally could salvage some pride for Indian markets which saw a remarkable 2024 but the last 3 months of the year has shaved off substantial gains. The closing for 2023 was at 21731 and a near double digit gain could be on cards.
INTERESTING CUES
Sugar industry raises alarm bells
The industry has been patiently waiting for revision of prices in sugar and ethanol since the LS elections in June 2024.Meantime sugar prices have dropped to Rs 35-35.5 from Rs 38 per kg last year. It is feared that sugar companies may witness a sharp slump in profits or even pushed into losses as costs are fast catching up with realizations. In anticipation of substantially higher production, sugar prices have dropped, and the permission to export at least 1-2 million tons will help mills struggling with lower prices. Meanwhile the Govt continues to encourage sugar mills to ethanol-diesel and even green hydrogen. Expectations are high that relaxation in exports will be considered soon as well as a revision in sugar and ethanol prices.
ITC Demerger date fixed on Jan 1
The New Year will usher the listing if ITC Hotels which has been long expected. The ratio has been fixed at 1:10. Alongside the demerger announcement, ITC also disclosed acquisitions in the hospitality sector. Through its wholly-owned arm, Russell Credit, ITC acquired a 2.44 % stake in EIH (Oberoi Hotels) and a 0.53 % stake in HLV Ltd (The Leela). Following these acquisitions, ITC now holds 16.13 per cent of EIH and 8.11 per cent of HLV, further solidifying its presence in the luxury hotel industry. The hotel industry is in a sweet spot enjoying surging demand from domestic and international tourists, rising room tariffs, booming marriage season and now a weakening rupee.2025 could see investor appetite at the highest for this industry.
NIFTY –The index belied hopes of a dash towards 25000 for which expectations were built based on the last day rally in the previous week. The index started on the back foot and saw gradual losses over the week and now with a closing below 24000 again, the level could now act as a resistance. Lower levels of 23300 will be critical for the week which will also see the monthly derivative expiry play out.
BANK NIFTY-The index was dragged down by private and PSU banks alike. Expectations of a lifetime high has not been met, now it has also shed significant ground which could see the index below 50000 in the coming days. Levels of 51200-300 should pose near term resistance.
STOCK PICKS
Hind Copper (271.4) -The stock has seen repeated resistance at 290-95. Levels around 280-85 could be ideal for selling the scrip. Near term support is at 260. However, the same could be breached for a possible target of 245-50.
TVS Electronics (405)-The stock has seen buying at corrections and after hitting a high of 495 it corrected to 320.However buying has emerged at lower levels. Accumulation could be considered for a possible target of 500 in the medium term.
Wishing all readers great trading week!
Note: Any queries /clarifications may be addressed to stockmasala@gmail.com .
Krish Subramanyam