🇮🇳Month's Price Volume Action- 26th Jan'25🇮🇳
All the Price Volume action at one place !
Hello All,
Not a great January for the bulls ! The markets kept bleeding throughout the month. None of the sectors gave a positive return. Stocks kept going down and portfolio going down by ~20-25% would be normal. In the newsletter, you would read how majority of stocks head downwards and trade below across different EMAs. With these corrections in last 2 months, the valuations across different indices is stil pretty high, the smallcap index at 30x, the midcap index at 40x, and Nifty at 21x continue to trade at lofty valuation multiples, unjustified by the sluggish earnings growth rates. Results are coming through and lets be hopeful that many sectors show some superb earnings to change the trend!
Now, Lets deep dive ! ☕️
Returns on Indices across time periods
Returns across Sectors in January
None of the sectors gave postive returs in January, closely followed by Microcaps (32.73%). Interestingly, returns on Gold & Silver were the only instruments which gave a postitive return. Realty (-20%) and Media (-13%) were the sector which gave the lowest returns. Nifty50 gave -3% whereas BankNifty gave -5.5% returns.
Nifty Smallcap100
NIFTY smallcap100 breaks the 50WEMA for the first time after May2023.
In a month , PE dropped from 34 to 31.
The PE of Nifty SmallCap100 is at 31.2. Some drop now can be observed as over last month, Out of 100, only 16 stocks have gained more than 5% whereas 84 gave negative returns.
How to read this ?
For 5Y, returns are max for S&P Industrials at 337% (Greenest) and min for Nifty Media at -13a% (Red). Similarly, one can check for each time period. The table is sorted by 5Y returns.
The below table includes the 4-week (4W), 20-week (20W), 30-week (30W), 40-week (40W), and 52-week (52W) moving averages. Each cell represents the percentage of total stocks in that sector, which are above the corresponding exponential moving average.
Nifty 50 Returns over last month
Out of 50, 28 stocks gave >5% returns in last 1 year and only 11 gave >5% in last 6 months.
→ In last 1 year, 24 have beaten the Nifty 50 returns (8.15%).
→ Only 2 out of 50, gave >50% returns in 1 year. (Trent and M&M). None gave more than 100%, our earlier benchmark :)
→ While 17 gave negative returns in last 1 year. IndusInd , Asian Paints and Adani Ent were the top 3 losers (all dropped more than -20%).
The Current PE = 21.9
Nifty 50 Historical Avg PE at different time periods are :
1M = 22.34 ; 3M = 22.64 ; 6M = 22.95
1Y = 22.73 ; 2Y = 22.21 ; 5Y = 25.05
"Stocks Touching 10-Year High" signifies that a stock has reached its highest price level in the past decade. This indicates long-term strong performance and positive market sentiment. It suggests robust business growth and investor confidence, potentially attracting more interest and indicating sustained upward momentum. However, it may also prompt caution regarding overvaluation. There can be others also which might be not part of the list but sharing here only those which have good ROCE/ROE/OPM/Revenue growth and also not overvalued.
NONE :)
Great momentum stocks indicating strong short-term and medium-term performance, driven by positive news, earnings reports, or market trends. Do note the valuations of the stocks!
Stocks at 52-Week High indicates that a stock has reached its highest price in the past year, reflecting strong performance and positive market sentiment. This milestone can signal upward momentum but may also suggest potential overvaluation. Investors often watch these stocks for further gains or reassess their strategies based on this performance indicator. For some traders, a stock hitting a 52-week high might signal a breakout, suggesting that the stock could continue to rise if it surpasses previous resistance levels.
NONE :)
52 week high Stocks are important to track and how they have historically provided returns is shown below.
I have taken a period of 5 years to back test this and compared the returns with Nifty500 Benchmark.
In technical analysis, the 200-day DMA is a long-term trend indicator. When the current price is below this level, it might signal a bearish trend or a downturn. While other aspect is that these leading stocks may be temporarily undervalued, presenting a potential buying opportunity for investors who believe the stock will revert to its mean or rise above the 200-day DMA again especially where the valuations are sane.
Near 52 week low but are good stocks fundamentally, If one would like to do some bottom fishing would be from one of these with sane valuations and sector uptrend.
Redington
JK Cement
Frog Cellsat
Divis Labs
Eicher Motors
Thanks for reading till now. I hope these 5-7 mins have added some value in your analysis.
Thanks,
Curious Investor