Weekly market wrap: Sensex, Nifty eke out slim gains in penultimate week of 2021

Benchmark equity indices managed to eke out marginal gains during the week gone by amid rising uncertainty over the new variant of Covid-19, Omicron. The 30-share BSE Sensex settled 112 points, or 0.20 per cent, higher at 57,124 on December 24 against 57,011 on December 17. Likewise, the 50-share NSE Nifty index advanced nearly 19 points, or 0.10 per cent to 17,003 during the same period.

As many as 22 stocks in the Nifty index ended in the green. With a gain of 8.01 per cent, HCL Technologies emerged as the top gainer in the list. It was followed by Cipla (up 5.59 per cent), Tech Mahindra (up 4.93 per cent), UPL (up 4.37 per cent) and Wipro (up 4.12 per cent). On the other hand, NTPC, Grasim Industries, BPCL, HDFC and Axis Bank each declined over 3 per cent.

Vinod Nair, head of research, Geojit Financial Services said, “The markets remain highly volatile amid rising Omicron cases, higher monetary policies and inflationary woes.”

Sectorwise, the BSE IT index gained the most 2.77 per cent during the week. BSE TECk, BSE Healthcare, BSE FMCG and BSE Consumer Durables also gained between 1 per cent and 2.50 per cent. However, the BSE Bankex, PSU, Oil & Gas and Power index lost over 1 per cent.

Going ahead, market watchers are advising investors to keep some power dry ahead of the key events. Rahul Shah, co-head of research, Equitymaster said, “Clearly, the bull does look tired currently, especially after sprinting continuously for the last 20 months. Now, all eyes are on the December quarter results that will start coming out soon and then the budget after that. From a strategy point of view, I believe it makes sense to start building up cash gradually and take it up to alteast 20-25% of the portfolio if not more.”

He further added that the near term undertones are more bearish than bullish, high cash allocation will allow you to escape any large near term correction with less damage and will also provide investors with the arsenal to deploy money at a later stage.

Foreign Institutional Investors (FIIs) stood net sellers in the equity segment during the week, with gross purchases of Rs 39,096.47 crore and gross sales of Rs 43,451.75 crore, leading to a net outflow of Rs 4,355.28 crore.

The coming week will be the final week of the calendar year, the domestic traders may witness volatility due to F&O December series expiry slated on December 30. In next week traders will zero in on core sector data. The growth of eight core infrastructure industries grew by 7.5 per cent in October 2021 as compared to the same month last year on account of healthy performance by segments like coal, natural gas, refinery products and cement.

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