Sensex and Nifty Reach New Highs: Understanding the Stock Market Surge

The Indian stock market saw a sharp decline, erasing nearly ₹5 lakh crore of investor wealth as the total BSE market capitalization fell to ₹427 lakh crore from ₹432 lakh crore. Key factors include foreign investor selloff, with FPIs offloading ₹51,000 crore this month, and weak Q3 earnings across sectors. Concerns over India’s slowing economy, delayed private capex, and weak demand growth added to the pressure. Additionally, global uncertainty, driven by Donald Trump’s trade policies, and caution ahead of the Union Budget 2025, have further impacted market sentiment.

January 21, 2025: Around 32 companies, including Tata Technologies, ICICI Prudential Life, Indiamart, UCO Bank, Tanla Platforms, Rossari Biotech, and PNB Housing Finance, are set to release their Q3 FY25 results today.

Tata Technologies is expected to post flat revenue growth of 0.3% YoY, reaching ₹1,301 crore, but with a decline in net profit. Investors are keen on updates regarding Airbus collaborations, client spending, and the technology solutions outlook. Tata Tech shares gained 2% to ₹828, while PNB Housing Finance rose 1.39% to ₹925 ahead of results.

Vodafone Idea shares surged 10% after reports of relief in Adjusted Gross Revenue (AGR) dues surfaced. The government is considering converting the telco's interest on AGR dues into equity, potentially reducing its financial burden. This decision could make the government the largest shareholder in the company, holding a 33% stake. Analysts believe this move may ease Vodafone Idea's cash flow issues and improve its survival prospects in a competitive telecom market. The company's financial stability remains critical as it works to regain market share.

Bitcoin surged to a record high of $109,241 as anticipation grows for Donald Trump’s return to the White House. The cryptocurrency rose 5.5% following the launch of Trump and Melania’s memecoins, which initially reached a $15 billion market cap before a sharp drop. This move energized the digital asset market, boosting top tokens like Ether and XRP. Traders are optimistic about Trump’s potential executive orders to prioritize crypto as a “national priority,” signaling a strong pro-crypto stance as he prepares to take office.

Indian markets faced a steep sell-off, with Sensex falling over 1,000 points from the day’s high, closing at 76,284.90, and Nifty dipping to 23,153.30, losing 191 points.

Banking and metal stocks led the decline, dragging all sectors into the red and wiping out ₹4.5 lakh crore in market capitalization. Mid-cap and small-cap stocks fell by 1% each, with stretched valuations indicating more downside. Major losers included Adani Enterprises, Kotak Mahindra Bank, and Reliance Industries. Global cues added pressure as Trump's new tariff plans dampened investor sentiment, overshadowing optimism in U.S. markets.

Shares of Dixon Technologies plummeted 10% to hit Rs 15,804 after a sharp drop in Q3FY25 earnings. The company's net profit fell 47.5% YoY to Rs 216 crore, while revenue dipped over 9% to Rs 10,453.7 crore.

Dixon’s consumer electronics sales saw a steep 32% decline. Jefferies maintained an 'Underperform' rating with a target price of Rs 12,600, citing a stretched valuation at 107x FY26 PE. The stock is down 12% year-to-date, underperforming Nifty 50, which fell only 1.5% in the same period.

Zomato shares plunged 13.3% to ₹207.80 on the NSE after the company reported a 57.2% drop in net profit to ₹59 crore for Q3 FY25, compared to ₹138 crore last year. Revenue surged 64% year-on-year to ₹5,405 crore, but expenses soared to ₹5,533 crore. Despite 17% growth in food delivery revenue, the company cited slower demand and tough competition. Nomura flagged weak performance in the food delivery business, projecting 17-20% GOV growth in FY25-26. Blinkit's store count expanded to 1,007, eyeing 2,000 by year-end due to rising competition.

Hexaware Technologies, a leading IT services firm, has received the Securities and Exchange Board of India's (SEBI) approval for its massive Rs 9,950 crore Initial Public Offering (IPO).

This will be one of the largest IPOs by an Indian IT company. The company, owned by Baring Private Equity Asia, plans to offer shares through an Offer for Sale (OFS). Hexaware aims to use the listing to unlock value and provide a strong exit strategy for its investors. The IPO could reshape the landscape of tech company listings in India.

Top Loser : -

1. SBI Life Insurance Co. Ltd: Declined by 2.65%, closing at ₹1,499.70.

2. Trent Ltd: Declined by 2.04%, closing at ₹6,090.00.

3. Shriram Finance Ltd: Declined by 1.86%, closing at ₹516.70.

4. Adani Ports and Special Economic Zone Ltd: Declined by 1.27%, closing at ₹1,148.70.

5. HDFC Life Insurance Co. Ltd: Declined by 1.27%, closing at ₹634.05.

Top Gainer : -

1. Kotak Mahindra Bank: Gained by 9.21%, closing at ₹1,920.50.

2. Wipro Ltd: Gained by 6.49%, closing at ₹300.25.

3. Bajaj Finance Ltd: Gained by 3.59%, closing at ₹7,440.10.

4. Bajaj Finserv Ltd: Gained by 3.25%, closing at ₹1,735.20.

5. NTPC Ltd: Gained by 3.04%, closing at ₹336.05.

Gold prices surged for the third straight day, reaching Rs 81,600 per 10 grams on Friday, nearing the all-time high of Rs 82,000 recorded last year.

This jump of Rs 700 from Thursday’s price of Rs 80,900 reflects robust domestic demand, as per the All India Sarafa Association. Gold of 99.9% purity is now trading at Rs 82,000. However, silver prices fell by Rs 500 to Rs 93,500 per kg. Gold last peaked on October 31, 2024, when it hit Rs 82,400 per 10 grams.

Laxmi Dental Limited made a strong debut on January 20, listing at ₹542 per share on the NSE, a 26.64% premium over its IPO price of ₹428. The stock later touched ₹550.55, marking a 28.63% gain during the day. Backed by OrbiMed, the company’s ₹698-crore IPO was oversubscribed 114 times, reflecting high investor interest. The BSE listing price was ₹528, a 23.36% premium. Laxmi Dental provides a wide range of dental solutions, including crowns, bridges, aligners, and pediatric products, with a post-listing market valuation of ₹2,979 crore.

The Sensex rose 454 points to close strong, while the Nifty settled near 23,350, driven by gains in power, telecom, and financial stocks. Major gainers on the Nifty included Kotak Mahindra Bank, Wipro, Bajaj Finance, NTPC, and Bajaj Finserv. Key laggards were SBI Life Insurance, Shriram Finance, Trent, HDFC Life, and Adani Ports. Sectorally, all indices ended in the green except auto and FMCG, with capital goods, PSU, telecom, and power sectors up 1-2%. The BSE midcap and smallcap indices also rose by nearly 1% each, signaling strong market momentum.

Donald Trump is set to take the oath as the 47th President of the United States in an indoor ceremony due to extreme cold weather.

The event will be attended by key figures, including CEOs from Amazon, Apple, and TikTok. India’s External Affairs Minister S. Jaishankar will also be present. Notably, Bitcoin surged to an all-time high of $109,241, highlighting economic shifts. While Chinese President Xi Jinping won’t attend, the inauguration is drawing global attention as a pivotal moment in history.

Bajaj Finance and Bharti Airtel have announced a unique collaboration to launch digital platforms for financial services. Airtel will begin by offering Bajaj Finance’s retail financial products on its Airtel Thanks App, followed by expansion through its 12-lakh-strong store network. Leveraging Airtel's massive 370 million customer base and Bajaj Finance’s 27 diverse products, the partnership combines Airtel's distribution strength and Bajaj Finance’s reach of 5,000 branches and 70,000 field agents. This alliance aims to simplify financial services access across India.

Brent Crude Futures, the global oil benchmark, surged 1.29% last week to close at $80.79 per barrel, marking its highest level since July 2024.

The climb, continuing for four weeks straight, shows positivity as prices exceed all major weekly moving averages (10, 20, 50, 100, and 200-week EMAs). Key drivers include tighter sanctions on Russia, speculation of stricter sanctions on Iran by Trump, and stronger-than-expected economic data from China. However, the Israel-Hamas ceasefire slightly cooled the rally, but oil-importing nations like India face rising challenges.

Global markets are bracing for Donald Trump's return as the 47th US President on January 20, as his policies could heavily impact trade and economic growth. Experts warn that tariffs aimed at protecting domestic industries might trigger trade disruptions, higher costs, and lower consumer spending. Economies reliant on exports may face major slowdowns. The US Dollar Index hit a high of 110.2 last week, closing at 109.4, while the 10-year Treasury yield, after peaking at 4.809%, dropped to 4.623%. Policy announcements will shape dollar strength and bond yields further.

Reliance Industries surged 5% after reporting strong growth in key segments. However, Q3 earnings so far show mixed results, with IT giants offering cautious commentary and Axis Bank missing expectations.

Next week, around 245 companies, including HDFC Bank, Hindustan Unilever, and ICICI Bank, will announce results, drawing market focus. Key names outside Nifty 50 include Zomato, Paytm, InterGlobe Aviation, Tata Technologies, and IDFC First Bank. Stocks like Persistent Systems, Adani Green Energy, and Syngene International will also be closely watched as earnings season gains momentum.