Sensex, Nifty to remain resilient as Santa Claus rally to continue

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Domestic markets are likely to enjoy the momentum despite Sensex and Nifty ruling at an all-time high. Positive global markets and strong domestic macro numbers will aid the positive sentiment. However, the settlement of monthly contracts at the NSE derivative segment will keep the market volatile, said experts.

Siddhartha Khemka, Head of Retail Research, Motilal Oswal Financial Services Ltd, said healthy macro data and rallies in global markets helped Nifty make new highs even during the holiday season. While the derivative’s monthly expiry on Thursday may infuse some volatility, the undertone remains bullish, with the market making steady gains in the last few weeks, said

Gift Nifty at 21,754 indicates a gap-up opening as Nifty December futures closed at 21,681.80 and Nifty January futures 21,854.10.

Prashanth Tapse, Senior VP (Research), Mehta Equities, said: strong global market undercurrent coupled with India’s robust macro performance in the past few quarters gave investors ample ammunition to go ballistic on India’s equities as Sensex reached a new milestone level of 72k mark led by gains in banking, auto and metal stocks.

“The rally came despite worries over the ongoing conflict at Gaza and attacks on ships at Red sea, while hopes of rate cuts in the US next year and receding worries of recession in developed economies going ahead dictated the optimistic mood,” he added.

Asian stocks are mixed in early deals on Thursday, with Japan and Taiwan stocks declining even as equities across Korea, Hong Kong, Singapore and Australia traded in the green.

“Looking at the daily chart, Nifty had a volatile session but managed to make a new record high of 21,675.55 and closed above 21,600. It formed a strong bullish candle on the chart with good volume, indicating a strong bullish momentum in the index. Overall, Nifty is maintaining a strong bullish trend with support levels at 21,500 and 21,400. Positional traders are advised to hold Nifty with a stop loss at 21,350,” said Mandar Bhojane, Equity Research Analyst, Choice Broking.

According to Open Interest (OI) data, the highest OI on the call side is 22,000, followed by 21,800 strike prices. On the put side, the highest OI is at the 21,500 strike price. This indicates the levels where options traders have the highest exposure, said Bhojane.