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Nifty Future All-time High Level Of 21,680 Pts, Sensex Ends At 70,506

Nikhil Bhatt | Research Analyst Dec 20, 2023

From the Nifty future all-time high level of 21,680 points, the Nifty future slumped more than 360 points or 1.66 per cent and settled at 21,169. The Sensex plunged by over 1,400 points from its lifetime high of 71,913 to end at 70,506, a 1.30 per cent cut.

Geopolitical tensions also played spoilsport as the impact on shipping routes in the Red Sea region dented investor sentiment. Traders were also tracking rising cases of the Covid sub-variant JN.1 in India. On Wednesday, 614 cases of Covid-19 were reported across India, the highest since 21 May.

Hindustan Construction, SpiceJet, Man Industries, Dish TV, MTNL, Indiabulls Real Estate, and Texmaco Infrastructure are among the smallcap stocks that dropped 9-12 per cent on Wednesday. There was selling across sectors, but power, telecom, metal, automobiles, capital goods and real estate bore the brunt of it.

The Nifty Energy index snapped a five-session gaining streak and ended nearly 3 per cent down. The BSE Power index, which hit a lifetime high earlier in the day, slumped more than 4 per cent. In the last month, the index has rallied more than 19 per cent.

FII and FPIs, on Wednesday, saw a net sales of Rs 1,322.08 crore in the cash segment. A total of Rs 20,512.08 crore was sold against a total purchase of Rs 19,190.00 crore. Domestic institutional investors saw a net purchase of Rs 4,754.34 crore in the cash segment. A total of Rs 11,439.84 crore was sold against a total purchase of Rs 16,194.18 crore.

Meanwhile, The domestic market saw a sharp and abrupt sell-off in the second half, despite the positive trend in global peers. This is attributable to profit booking from the recent sharp rally stretching valuations of mid- and small-cap stocks. The recent uptick in crude prices prompted investors to book profit.

Overall, we remain positive on the market and expect recovery after a pause supported by global macros along with interest rates peaking out and healthy domestic macros.

Technically, the important key resistances placed in October Nifty future are at 21,169 levels, which could offer the market on the higher side. Sustainability above this zone would signal opens the door for a directional upmove with immediate resistances seen at 21,202 – 21,303 levels. Immediate support is placed at 21,008 – 20,880 levels.