Indian market hit fresh highs in the week of November 25, as investors cheered a slowdown in the pace of Federal Reserve rate hikes, lower crude prices, a weaker dollar and suggestions foreign investors bought.

For the week, the 30-pack BSE Sensex gained 630.16 points, or 1%, to end at 62,293.64, while the broader Nifty gained 205.15 points, or 1.12%, to end at 18,512.80.

The Sensex and Bank Nifty also hit new all-time highs this week, while the Nifty was just shy of its all-time high.
Sector-wise, the Nifty media index was up 5.4%, the PSU banking index was up 5%, while the oil and gas index and the information technology index were up 2.5%. However, the Nifty real estate index fell nearly 1%. The BSE midcap index was up 2%, the small-cap index was up 1.5%, and the large-cap index was up 0.8%.

Vinod Nair, head of research at Geojit Financial Services, said: “Bulls dominate Dalal Street, which is near record highs, supported by favourable factors such as FII buying, lower crude oil prices, lower US dollar index and lower bond yields.”

Federal Open Market Committee (FOMC) meeting minutes hinted at a possible slowdown in the rate hike cycle. Oil prices fell amid talk of a cap on Russian crude prices and rising inventories of US products. However, he said China’s strict COVID lockdown had negatively impacted global growth forecasts.

“Looking ahead, the absence of strong fundamental triggers will limit the upside, keeping markets volatile in the near term. Nair added that the Fed chair speech scheduled for next week and other key macroeconomic data releases would determine the market’s future trajectory.

During the week, foreign institutional investors (FII) sold shares worth Rs 1,480.46 crore, while domestic institutional investors (DII) bought shares worth Rs 1,781.47 crore.

FIIs bought shares worth Rs 11,358.48 crore in November, while DIIs sold shares worth Rs 1,588.43 crore. It was also a good week for some small-cap stocks, with the BSE small-cap index up 1.5%.

Easy Trip Planners, Fino Payments Bank, UCO Bank, Dish TV India, Hi-Tech Pipes, Skipper, Cressanda Solution, Vascon Engineers, Kabra Extrusion Technik, Rashtriya Chemicals and Fertilisers, Rossell India and India Tourism Development Corporation, rose between 21% and 36%.

On the other hand, Future Lifestyle Fashions, Sintex Plastics Technology, Gujarat Themis Biosyn, Kirloskar Oil Engines, Nureca, Sree Rayalaseema Hi-Strength Hyp, and Faze Three fell 10-22%.

The BSE500 rose 1%, with Easy Trip Planners, UCO Bank, Rashtriya Chemicals and Fertilisers, RHI Magnesita India, Gujarat State Petronet, Punjab National Bank, Bharat Heavy Electricals, Rail Vikas Nigam and Indian Railway Finance Corporation up 15-36%.

Earlier this week, the Nifty tested the short-term support zone of 18,100-18,200 and rose as the week progressed. The index formed a bullish outer line on the weekly chart, and this week’s low of 18133 became a key support.

On November 25, the Nifty briefly consolidated around 18,500. The benchmark index is likely to hover around an all-time high of 18,604. This will be the make-or-break level monitored at the close, determining further action. The immediate support area continues at 18,400-18,380.

Motilal Oswal Financial Services expects the upward momentum to continue on the back of positive global signals, lower crude oil prices and gradual economic recovery.

Participation in the broader market is also encouraging, which should help the market climb further. We believe that once the Nifty breaks the previous high of 18604, it will steadily rise to 19,000 in the next few weeks.

With benchmarks at all-time highs, improvements in broader participation will play a key role in shaping market trends.