Dalal Street Corner: Markets snap 3-day gain on Christmas Eve; What should investors do on Monday?

The bank and financial stocks dragged the Indian markets and snapped three-day gains during Friday’s session on Christmas eve. The BSE Sensex closed around 200 points, while Nifty50 ended at an important level of the 17000-mark.  

Underperforming the benchmarks, the broader markets too witnessed weakness as mid-cap slipped over 1 per cent, and small-cap nearly half a per cent at the market close. While Nifty Bank, one of the key contributors to Nifty, slipped 335 points or 0.95 per cent to 34,856 at the close. 

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The last hour's recovery by the markets was mainly led by index heavyweights such as Reliance Industries and IT stocks like HCL Tech, which was a top gainer to end over 3 per cent higher. While Tech Mahindra, Wipro and Infosys also contributed to the last hour's recovery of the market at close. 

Of 50 scrips on Nifty, 11 advanced and 39 declined. Reversing its trend, Grasim shares saw, profit booking, to end as top loser down almost 3 per cent, followed by NTPC down over 2.5 per cent. M&M, Axis Bank, Kotak Mahindra Bank shares also contributed to the markets decline.  

On the news basis, L&T Financial slipped over 7 per cent after the company announced the divestment of its MF business; Similarly, unlocked theme stocks such as Indian Hotels, Delta Corp, PVR also tumbled amid fresh restrictions on the back of Omicron scare. 

In the IPO segment, Data Patterns’ shares made a stellar debut on the bourses on Friday, December 24. The stock was listed at around a 48 per cent premium to Rs 864 per share on the BSE and over 46 per cent at Rs 856.05 per share on the NSE from its issue price of Rs 585 per share. 

Vijay Dhanotiya, Lead of Technical Research at CapitalVia Global Research said, “We witnessed some correction in the market after it failed initially to sustain the level of 17000. While sustaining above 17000 is the key factor from a short-term perspective, our research suggests, a decisive breakout above the zone of 17180-17200 could open the gate for a movement till 17400.” 

“A range-bound day of trading ahead of Christmas to end the week as this month quite clearly belonged to the IT sector which stood tall amidst extreme volatility as cost-push inflation across sectors is keeping street worried on the impact in the hands of the consumer, S Ranganathan, Head of Research at LKP securities said in a post-market comment. 

He added, “While buoyancy in exports and tax collections coupled with the success of the PLI schemes are positives, there are many sectors where consolidation is waiting to happen which is where longer-term investors need to focus in the present corrective phase.”