Sensex Down 423 Points, Nifty at 23,203; Nifty Prediction for Monday

Nifty Prediction for Monday

Sensex and Nifty End with a Decline: What to Expect on January 20

The Indian stock market concluded the trading session on January 17 with a decline across both major indices—Sensex and Nifty—after a volatile trading day.

Despite some gains from select sectors, the broader market sentiment remained negative, driven by persistent bearish pressure.

While Nifty faced resistance at key moving averages, the decline across major stocks in the IT and banking sectors further compounded the selling sentiment.

Market observers remain cautious, as the future direction of the indices will depend largely on key technical levels and upcoming earnings reports.

Here is a detailed breakdown of the market’s performance and expert insights into what could shape the market heading into January 20.

Market Performance on January 17

Both the Sensex and Nifty ended the day in the red. The Sensex closed at 76,619.33, down by 423.49 points, or 0.55%, while the Nifty closed at 23,203.20, registering a loss of 108.60 points, or 0.47%.

In total, 1,975 stocks advanced, while 1,797 stocks declined, with 116 stocks remaining unchanged. This reflects a market that is struggling to maintain upward momentum, with the number of decliners slightly outweighing the advancers.

Notably, the Nifty faced resistance at key technical levels, which further fueled the decline. The 23,400-level, in particular, has emerged as a significant resistance point, preventing the index from recovering.

Meanwhile, on the downside, 23,000 remains a crucial support level, and a break below that level could signal further weakness in the market.

Sectoral Performance: A Mixed Picture

While some sectors showed resilience, others continued to face significant headwinds. The IT and banking sectors, which are typically seen as market bellwethers, were among the biggest decliners.

Both sectors fell by approximately 2% during the day. This was largely due to disappointing earnings from major IT and banking companies, which had a ripple effect on the broader indices.

On the other hand, sectors such as Oil & Gas, Power, FMCG, PSU, Capital Goods, Realty, and Metals managed to show modest gains of up to 1%.

These sectors have been benefiting from a combination of strong fundamentals, positive earnings surprises, and in some cases, global tailwinds.

Notably, stocks such as BPCL, Reliance Industries, and Hindalco Industries performed well and cushioned some of the declines in the broader market.

The performance of the Midcap and Smallcap indices was largely flat, reflecting investor caution and a lack of significant momentum in either direction.

While some stocks in the broader market showed promise, the overall environment remained uncertain, with market participants waiting for clearer signals on the earnings front.

Key Stock Movers: Winners and Losers

Among the Nifty 50 stocks, Infosys, Axis Bank, Shriram Finance, Kotak Mahindra Bank, and Wipro were among the biggest losers of the day.

These stocks suffered from a combination of disappointing earnings results, adverse global cues, and sector-specific pressures.

Infosys, in particular, faced substantial selling pressure after its earnings report failed to meet expectations, leading to a decline in IT stocks.

In contrast, a few blue-chip stocks managed to buck the trend and posted gains. BPCL, Reliance Industries, Hindalco Industries, Nestle India, and Hindalco Industries were among the notable gainers, helping to provide some stability to the market.

Reliance Industries, which is often considered a market leader, gained due to positive momentum in its core business segments, such as telecom and retail. Similarly, Nestle India continued its upward trajectory on the back of strong consumer demand.

Technical Outlook: Bearish Pressure Continues

Rupak Dey, Senior Technical Analyst at LKP Securities, observed that Nifty continued to face significant bearish pressure.

He noted that the index struggled after encountering resistance at critical moving averages, which further confirmed the bearish sentiment in the market.

According to Dey, this weak sentiment may persist in the short term unless Nifty manages to break above the 23,400 level. Until that happens, the outlook remains negative, and the market may continue to face downward pressure.

In Dey’s view, the Nifty could potentially decline toward the 23,000 mark in the near future. If the index breaks below this key support level, it could trigger a larger correction.

On the other hand, if the Nifty fails to reclaim the 23,400 level, it may continue to test lower levels, which could lead to a more significant retracement. Investors should remain cautious and be prepared for further volatility.

Expert Views: Mixed Sentiment and Cautious Approach

Ajit Mishra, Senior Vice President of Research at Religare Broking, also provided his perspective on the market’s current state.

Mishra described the market as volatile, noting that after three consecutive days of gains, the indices fell by about 0.50% on January 17.

The initial weakness was attributed to disappointing results from large IT and banking companies, which spooked investors and led to a broad sell-off in these sectors.

However, Mishra pointed out that buying interest in heavyweight stocks like Reliance, ITC, and L&T helped to limit the decline, especially in the latter part of the session.

He further emphasized that the market is currently caught in a tug-of-war between bullish and bearish forces.

While there is some optimism in select stocks, largely driven by rotation in market leadership, there are significant headwinds as well.

Mishra highlighted continuous FII selling as a concern, which has been putting downward pressure on the market. Furthermore, the mixed performance of earnings so far has added to investor uncertainty.

Given these factors, Mishra recommended adopting a “sell on the bounce” strategy, advising investors to stay cautious and avoid committing to broad market positions until there is more clarity on the market’s direction.

He also suggested that investors focus on stock-specific opportunities, particularly in the ongoing earnings season, where some companies may outperform despite the broader market weakness.

Prediction for January 20: Key Levels to Watch

Looking ahead to the trading session on January 20, the market is expected to remain volatile, influenced by global cues, domestic earnings reports, and technical levels.

The Nifty’s key resistance level remains at 23,400, and investors will be watching this closely. If the index manages to break above this level, it could signal a potential rebound. However, the downside risks remain, with 23,000 acting as a critical support level.

The market is likely to continue its cautious stance, with stock-specific moves offering the best opportunities.

With earnings season in full swing, investors will be closely monitoring the results of major companies, particularly in the IT, banking, and consumer sectors, as these will provide more clarity on the broader market outlook.

Final Remarks

The Indian stock market has shown signs of vulnerability in recent sessions, and the outlook for January 20 remains uncertain.

While select sectors and stocks may provide opportunities, broader market sentiment is likely to stay cautious in the absence of clear triggers for a rally.

Investors should be prepared for further volatility, keeping a close eye on key technical levels and earnings reports.

A selective, cautious approach seems to be the best strategy in the current environment as the market navigates through mixed signals and uncertain global conditions.