Indian Stock Market Sees Strong Recovery Ahead of Diwali

Mumbai, November 1 (Daily Kiran) : The Indian stock market has made a robust comeback just ahead of Diwali, following a period of sustained pressure. During the trading week from October 26 to 30, the Sensex rose by 1,335.70 points, or 1.83%, closing at 74,459.53. Meanwhile, the Nifty 50 gained 453.10 points, or 2.00%, finishing at 23,053.10. Investor confidence was bolstered by renewed buying in the pharma, IT, and select sectors, allowing the market to end the week on a positive note.

Market experts indicate that the direction of the market in the first week of November will be influenced by several global and domestic factors. Key elements include the upcoming U.S. mid-term elections, tensions between the U.S. and Iran, fluctuations in crude oil prices, and corporate earnings reports. While there is a bullish sentiment in the market, volatility may still persist.

Experts observed that the Nifty began the week on a weak note, falling to a weekly low of 22,387.35 on the first trading day. However, strong buying at this level helped the market recover, leading to the Nifty closing at 23,053.10. Throughout the week, the index managed to gain approximately 453 points, representing a 2% increase.

Technically, the Nifty found strong support near the 200-week exponential moving average (EMA) and a long-term uptrend line, improving the market’s short-term outlook compared to previous weeks.

In terms of sector performance, the Nifty Pharma index emerged as the biggest winner, climbing nearly 7.09%. The media index followed with a 4.34% increase, while the realty index saw a rise of 3.77%. Additionally, sectors such as metals, automobiles, FMCG, and PSU bank stocks experienced gains of 2% to 3%. However, growth in the banking and financial services sector remained relatively limited.

Analysts noted that the second-quarter earnings have supported stock-based buying across several sectors. They predict that the immediate resistance level for the Nifty is at 23,200. If the index can decisively break through this level, the next target could be between 23,700 and 24,000.

On the downside, 22,850 is identified as the first major support level, followed by the critical range of 22,600 to 22,400, where the 200-week EMA and long-term trendline are located.

Experts express concern over crude oil prices, which recently surged above $117 per barrel. Sustained high oil prices could increase inflationary pressures and affect foreign investment flows. Additionally, U.S.-Iran tensions and the mid-term elections are expected to be significant factors influencing global markets.

While the technical situation of the market has improved, the Nifty must maintain its position above 23,200 to solidify its strength. The current strategy is to adopt a “buy on dips” approach, focusing on selective purchases during market declines.