The Indian equity markets kicked off the new year on a powerful note, posting significant gains on Friday, January 2. The rally was fueled by widespread buying activity across various sectors and growing optimism as the third-quarter earnings season approaches.
Market Performance and Key Levels
The benchmark S&P BSE Sensex climbed 573 points, or 0.67%, to settle at 85,762.01. The Nifty 50 index on the National Stock Exchange was the star performer, scaling a fresh intraday peak of 26,340 before closing at an all-time high of 26,328.55. This marked a gain of 182 points, or 0.70%.
The bullish sentiment extended to the broader markets as well. The BSE Midcap index advanced by 0.97%, while the Smallcap index rose 0.79%, indicating healthy participation beyond the large-cap stocks.
Expert Analysis and Sectoral Rally
Ganesh Dongre, Senior Manager of Technical Research at Anand Rathi, commented on the week's strong finish. He noted that the Nifty 50 gained 1.10% over the week, supported by positive global cues. Broader market indices outperformed, surging between 3% and 6%.
Sectorally, the Metal index spearheaded the charge with an impressive 6.3% jump. The Oil & Gas, Automobile, Banking, and Power sectors also showed robust strength, each registering solid gains of approximately 3-4%.
Technical Outlook and Trading Strategy
According to Dongre, the Nifty has convincingly broken through a crucial resistance zone between 26,000 and 26,300. The index has established a new support base in the 25,800-25,900 range, with immediate resistance now placed at 26,600, followed by 27,000.
For Bank Nifty, which ended the week up 1.93% above the 60,000 mark, support is seen at 58,000-58,500 and resistance near 61,000. Dongre stated that market sentiment remains positive as long as Nifty holds above 25,600 and Bank Nifty stays above 58,000.
He advised traders to maintain a disciplined 'buy on dips' approach in selective stocks while monitoring global developments. Dongre also provided specific recommendations for the coming week:
- Steel Authority of India (SAIL): Buy in the range of ₹145-150, with a target price of ₹160 and a stop loss at ₹140.
- Indian Energy Exchange (IEX): Buy between ₹130-135, aiming for ₹148, with a stop loss of ₹125.
- HCL Technologies: Buy in the ₹1635-1640 range, targeting ₹1700, with a stop loss at ₹1600.
The overall market structure appears constructive, setting an optimistic tone for the start of the quarterly results season and the weeks ahead.
