Markets Gain Speed Amidst Volatility

In the domestic markets, investors continued to remain bullish as indices continue to breach record highs. Bulls continue to project their dominance in specific sectors ahead of Union Budget 2021. 

The stock markets continue to remain volatile in spite of touching record highs multiple times during the fortnight. Bulls continue to project their dominance in specific sectors ahead of Union Budget 2021. On the other hand, concerns regarding rising US-Sino tensions as well increasing number of corona virus cases with the new strain are being brushed off with investors’ confidence building up on the positive Q3FY21 results’ data. In the global markets, DJIA and S & P 500 surged by 2.22 per cent and 1.95 per cent, respectively, while NASDAQ gained by 1.45 per cent. In the European markets, FTSE 100 index gained 2.97 per cent while DAX rose by 1.27 per cent. French index CAC 40 gained by a mere 0.90 per cent during the fortnight. Asian markets gained on positive global cues. Shanghai Composite index surged 4.51 per cent while Hang Seng jumped by 5.04 per cent in the last few weeks. Nikkei witnessed an increase by 2.07 per cent during the fortnight with the Japanese markets remaining closed on January 11, 2021 on the occasion of a national holiday. In the domestic markets, investors continued to remain bullish as indices continue to breach record highs. Benchmark indices Sensex and Nifty gained by 3.48 per cent and 3.97 per cent, respectively.

The broader markets outperformed as the Small-Cap index surged by 5.06 per cent while the Mid-Cap index jumped by 7.38 per cent. During the fortnight, Auto index and IT index were the top gainers, surging by 10.20 per cent and 10.16 per cent, respectively. Ahead of the budget session, Metal index and Realty index climbed up by 9.78 per cent and 7.61 per cent, respectively. Healthcare index gained by 3.70 per cent while Power index was up by 3.13 per cent during the fortnight. FMCG and Bankex inched up higher by 0.83 per cent and 1.60 per cent, respectively.

Trading data shows that FIIs were net buyers to the tune of Rs 6,582.17 crore while DIIs were net sellers to the tune of 5,135.93 crore. During the fortnight, gold prices fell by around 1.93 per cent to Rs 50,750 for 10 grams of 24 carat gold. As for crude oil prices, WTI crude price jumped by 11.62 per cent from USD 48 to USD 53.58 while Brent crude price surged by 11.24 per cent from USD 51.23 to USD 56.99. Oil prices witnessed an upward trend after Saudi Arabia announced an additional million barrels of crude oil production cuts. Supporting the move, a decrease in US’ oil inventories as well a weak dollar also led to elevated oil prices.