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Informist, Thursday, Jan. 1, 2026

 

By Arundathi A R

 

MUMBAI – Benchmark equity indices are likely to rise on Friday, with some analysts expecting the Nifty 50 to touch a lifetime high soon. Expectations of stronger earnings in the December quarter and announcements in the Budget should guide market direction in the near term, analysts said.

 

"Looking ahead, we remain sanguine on market sentiment and advocate a buy-on-dips strategy at the previously identified support levels in the index," Osho Krishan, chief manager of technical and derivative research at Angel One, said.

 

Other technical analysts also spoke on similar lines. "After a smaller consolidation movement near 26100–26200 levels in the short term, the Nifty is expected to show a sharp breakout towards 26300–26400 levels in the near term," Nagaraj Shetti, senior technical research analyst at HDFC Securities, said in a note.

 

Among sectors, analysts are positive on metal companies' earnings but have raised concerns around valuation. "Profit bookings are likely for the metal companies after the 12% imposition of safeguard duty on imports of select steel products for three years and on expectations of better December quarter earnings," a research analyst, covering the metal sector at a domestic brokerage, said. He also believes that the current valuations for the metal companies are not at comfortable levels.

 

On Thursday, the Nifty 50 index closed higher for the second straight session, while the Sensex closed marginally lower after rising in the previous session. The Nifty 50 settled at 26146.55 points, up 16.95 points, or 0.1%. The BSE Sensex closed at 85188.60 points, down 32 points. Analysts pegged the resistance level for Nifty 50 at 26300–26350 and support at 26000.

 

Market participants await the first advance estimate of GDP for 2025–26 (Apr-Mar) from the National Statistics Office, scheduled for release on Wednesday. 

 

Among stocks, shares of cigarette companies may continue to face selling pressure after the government imposed an additional excise duty on cigarettes. Post this, Nuvama Wealth Management downgraded ITC to 'hold' from 'buy' with a target price of INR 415.

 

The brokerage said it expected a sharp tax hike on cigarettes, but the magnitude of the increase seems higher than anticipated. This will reduce the company's volume and earnings before interest, tax, depreciation, and amortisation estimates, as well as its multiples, according to the brokerage. Nuvama cut its EBITDA estimates for FY27 and FY28 by 7?ch, and its tobacco price-to-earnings valuation to 17 times from 23 times.  End

 

Edited by Saji George Titus

 

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