Reasons behind the stock market rally – Weekly Analysis
Weekly Stock Market Analysis and the reasons behind the rally (6 Dec- 10 Dec): The Indian stock markets started the week on a negative note but later traded in an optimistic mode. The equity benchmark indices, Sensex and Nifty gained 1.89 percent and 1.83 percent respectively during the week ended 10 December. We will now discuss what are the reasons for the stock market rally during the week.
Reasons behind the stock market rally during the week
Markets gained on a weekly basis after it was confirmed that the new variant Omicron is a contiguous virus but may not be as virulent or as pathogenic as the delta variant. Globally markets reacted positively after the news. The RBI’s decision of status quo in the interest rate and maintaining accommodative policy stance also supported the market sentiments during the week ended 10 December. The upside remained capped as traders were cautious ahead of the country’s IIP and US inflation data
Weekly Stock Market Indexes Analysis ( 6 Dec- 10 Dec )
On a weekly basis, Sensex gained 1090.21 points or 1.89% and closed at 58786.67, while Nifty closed higher by 314.3 points or 1.83% and ended at 17511.3 levels. The Bank Nifty on the spot price was up by 908.5 points or 2.51 % on a weekly basis and finished at 37105.65 levels.
The midcap and smallcap indexes also closed in the green during the week ended 10 December. The Nifty midcap index was up by 372.85 points or 3% and closed at 31203.05 levels. The Nifty small-cap index was finished higher by 424.2 points or 3.93 % and ended at 11251.2 levels
NSE weekly top gainers and losers
| NSE Weekly Nifty Top Gainers | |||
| Company Name | LTP | Previous Close | Change (%) |
| Hindalco | 455.10 | 424.65 | 7.17 |
| ITC | 236.10 | 221.65 | 6.52 |
| ICICI Bank | 758.00 | 716.30 | 5.82 |
| Asian Paints | 3283.15 | 3110.45 | 5.55 |
| Tata Steel | 1180.00 | 1118.00 | 5.55 |
| NSE Weekly Nifty Top Losers | |||
| Company Name | LTP | Previous Close | Change (%) |
| Coal India | 151.30 | 159.75 | 5.29 |
| Divis Lab | 4506.45 | 4757.05 | 5.27 |
| Cipla | 893.90 | 912.05 | 1.99 |
| IOCL | 120.05 | 122.20 | 1.76 |
| Power Grid Corp | 202.65 | 206.10 | 1.67 |
NSE weekly mid-cap top gainers and losers
| NSE Weekly Nifty Midcap Top Gainers | |||
| Company Name | LTP | Previous Close | Change (%) |
| Adani Total Gas | 1825.00 | 1572.95 | 14.58 |
| Vodafone Idea | 16.40 | 14.45 | 13.49 |
| NSE Weekly Nifty Midcap Top Losers | |||
| Company Name | LTP | Previous Close | Change (%) |
| JSW Energy | 299.35 | 323.10 | 7.35 |
| Dr. Lal Path Labs | 3502.40 | 3710.00 | 5.60 |
NSE weekly small-cap top gainers and losers
| NSE Weekly Nifty Smallcap Top Gainers | |||
| Company Name | LTP | Previous Close | Change (%) |
| Trident | 54.70 | 44.65 | 22.51 |
| HFCL | 86.80 | 71.20 | 21.91 |
| NSE Weekly Nifty Smallcap Top Losers | |||
| Company Name | LTP | Previous Close | Change (%) |
| Indigo Paints | 2071.75 | 2208.70 | 6.20 |
| Stride Pharma | 460.45 | 489.15 | 5.87 |
The global stock market rally
The global stock market rally was witnessed during the week ended 10 December. This is due to the fear of new covid variants subsiding. The US markets recorded the best weekly gains since February 2021. The economic data released during the week has also supported the markets. American’s applied for unemployment benefits was the multi-decade lowest whereas the inflation raised to a record of 39 years high, which was in line with the expectation. The US markets gained after releasing inflation data last Friday as investors hope that price increases may be nearing a peak.
European markets closed higher during the week as fears about the new covid variant and its impacts on economic growth have been minimized. Germany’s industrial production rose in October much more than was expected whereas UK’s GDP expanded 0.1% in October, slowing from 0.6% in September.
Japanese market index Nikkei 225 has gained during the week after the fear of new covid variants eased. The upside remained capped as the GDP contracted more than it was estimated in the third quarter. Chinese Shanghai also gained during the week after the central bank cut the reserve requirement ratio (RRR) for banks and on easing inflation concerns.
FIIs and DIIs investment
The Foreign Institutional investors were the seller and the Domestic Institutional Investors (DIIs) were the buyers in the Indian stock markets. FIIs sold 9203.47 crores, whereas DIIs bought Rs 7212.35 crore in the cash market segment during the week ended 10 December.
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