..... . VALI disclosures . .....: 07/01/26, According to goodreturns.in

Wednesday, January 7, 2026

07/01/26, According to goodreturns.in

Indian equity markets are expected to open on a cautious and range-bound note on Wednesday, January 7, after extending losses for two consecutive sessions.

With benchmark indices hovering near record highs, investors are likely to adopt a wait-and-watch approach amid mixed global cues, lingering geopolitical concerns and continued profit booking in heavyweight stocks.

Stock Market Outlook Today, January 7, 2026: Sensex, Nifty Prediction For Wednesday

While strong Q3 business updates and selective sectoral strength may provide support on declines, uncertainty around global macro data and trade-related developments could cap sharp upside, keeping market sentiment guarded in the near term.

At the close of trade, the BSE Sensex declined 376.28 points, or 0.44 percent, to settle at 85,063.34, while the NSE Nifty50 fell 71.60 points, or 0.27 percent, to end at 26,178.70. The broader market also mirrored the weakness, with the Nifty Midcap and Smallcap indices closing lower by 0.19 percent and 0.22 percent, respectively.

Stocks in Focus Today: IT, Pharma, PSU Banks Stock To Watch

Sectoral performance remained mixed. IT, pharmaceuticals, PSU banks, and metal stocks outperformed the broader market, gaining between 0.3 percent and 1.7 percent on the back of selective buying and strong quarterly business updates. In contrast, infrastructure, media, oil & gas, and capital goods stocks witnessed notable selling pressure, with indices declining 0.6-1.6 percent due to profit booking and cautious positioning.

Commenting on market movement, Siddhartha Khemka, Head of Research, Wealth Management at Motilal Oswal Financial Services, said, "Indian equity markets declined for a second consecutive session, with the Nifty ending 0.3 percent lower amid profit-booking in heavyweight stocks and renewed geopolitical concerns."

He added that sentiment was further dented by resurfacing trade worries after comments from the US President regarding potential tariff hikes on India linked to Russian oil purchases.

Stock-specific weakness also weighed on the indices, as Reliance Industries fell over 4 percent-its steepest intraday decline in more than eight months-while Trent dropped 9 percent following a weak Q3 business update. On the positive side, pharma stocks gained 1.7 percent, while Nifty Financial Services and Nifty PSU Bank rose 0.7 percent and 0.6 percent, respectively, supported by encouraging quarterly trends.

Looking ahead, investors will closely track key global economic data, including the US S&P Global Composite PMI, Eurozone CPI, ADP non-farm employment data, and JOLTS job openings, which could influence near-term market direction. According to Khemka, "Markets are likely to trade sideways, with positive Q3 business updates being weighed down by geopolitical uncertainty. This back-and-forth is expected to continue in the near term."

Nifty Prediction Today for 7 January 2026

From a technical perspective, Bajaj Broking noted that the Nifty has formed a high-wave candle with a lower high and lower low, indicating consolidation with a corrective bias for the second session in a row after last week's strong up move. However, the brokerage remains constructive, stating that the broader structure stays positive.

"A buy-on-declines approach continues to favour bulls as long as the index sustains above the 26,000-25,900 support zone," it said. Nifty is expected to consolidate in the 26,000-26,370 range, with a breakout above 26,373 opening the door for upside towards 26,500 and later 26,800-26,900 levels.

Bank Nifty Prediction For Wednesday

Meanwhile, Bank Nifty showed relative resilience, forming a small bullish candle near its all-time high, driven largely by PSU bank outperformance. Bajaj Broking highlighted that "a follow-through strength above 60,437 could trigger an upside move towards 60,700 initially and then 61,400." On the downside, immediate support lies at 59,500, with a crucial support zone at 59,000-58,800. Sustaining above this range would keep the overall bias positive.

Disclaimer

The views and recommendations expressed are solely those of the individual analysts or entities and do not reflect the views of Goodreturns.in. All information is provided for informational and educational purposes only and should be independently verified from licensed financial advisors before making any investment decisions.

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Trade Cycles

The four important features of Trade Cycle are (i) Recovery, (ii) Boom, (iii) Recession, and (iv) Depression!

The trades cycle or business cycle are cyclical fluctuations of an economy. A full trade cycle has got four phases: (i) Recovery, (ii) Boom, (iii) Recession, and (iv) depression. The upward phase of a trade cycle or prosperity is divided into two stages—recovery and boom, and the downward phase of a trade cycle is also divided into two stages—recession and depression.

Phases of Trade Cycle:

The phases of trade cycle are explained with a diagram:

(1) Recovery:

In the early period of recovery, entrepreneurs increase the level of investment which in turn increases employment and income. Employment increases purchasing power and this leads to an increase in demand for consumer goods.

As a result, demand for goods will press upon their supply and it shall, thereby, lead to a rise in prices. The demand for consumer’s goods shall encourage the demand for producer’s goods.

The rise in prices shall depend upon the gestation period of investment. The longer the period of investment, the higher shall be the price rise. The rise of prices shall bring about a change in the distribution of income. Rent, wages, interest do not rise in the same proportion as prices.

Consequently, the margin of profit improves. The wholesale prices rise more than retail prices. The prices of raw materials rise more than the prices of semi-finished goods and the prices of semi-finished goods use more than the prices of finished goods.

(2) Boom:

The rate of investment increases still further. Owing to the spread of a wave of optimism in business, the level of production increases and the boom gathers momentum. More investment is possible only through credit creation. During a period of boom, the economy surpasses the level of full employment and enters a stage of over full employment.

(3) Recession:

The orders for raw materials are reduced on the onset of a recession. The rate of investment in producers’ goods industries and housing construction declines. Liquidity preference rises in society and owing to a contraction of money supply, the prices falls. A wave of pessimism spreads in business and those markets which were sometime before sellers markets become buyer’s markets now.

(4) Depression:

The main feature of a depression is a general fall in economic activity. Production, employment and income decline. The prices fall and the main factor responsible for it is, a fall in the purchasing power.

The distribution of national income changes. As the costs are rigid in nature, the margin of profit declines. Machines are not used to their full capacity in factories, because effective demand is much less. The prices of finished goods fall less than the prices of raw materials.

✳Reality Tips to Traders

1)Trading in the stock market is a marathon. 2)Protecting your capital is key. (Learn to protect first) 3)Making 0 on the day is better than losing 50k 4)Losses happen; they are part of this business. 5)It’s not you vs. the market. It’s you VS you. 6)You are your biggest enemy; learn to be mentally disciplined. 7)Don’t follow the majority; follow the correct path. 8)Traders without a stop loss end up not being traders for long. 9)There is always another trade. 10)The big money is made waiting for the right set-ups. 11)Waiting for the right trade is the most powerful strategy. 12)It is better to cut a loss than to wait to be proven right. 13)Position sizing can make or break you. 14)Worry about the downside before you even think about the upside. 15)Don’t listen to headlines

..BANKING TERMINOLOGY

There are various types of Banks: PSU Banks, Private Banks, Co-operative/Regional Banks, Small Finance Banks and Foreign Banks. When you deposit money in a bank, let's say the bank gives you an interest rate of 4%. But when the bank lends out this money, they lend it out at say, 12%. The difference of 8% in the above scenario is effectively the profit of the bank! The loans that do not pay interest for 90 days are known as Non-performing Assets. Banks have to provide for such bad loans. Structure of a Bank Asset for a Bank: The asset portion of a bank's capital includes cash, government securities, and interest-earning loans (e.g., mortgages, letters of credit, and inter-bank loans). Liabilities for a Bank: The bank's main liabilities are its capital (including cash reserves and, often, subordinated debt) and deposits. The latter may be from domestic or foreign sources (corporations and firms, private individuals, other banks, and even governments). Banks are required to maintain Liquidity with the Reserve Bank of India: SLR (Statutory Liquidity Ratio): It is the money a bank needs to preserve in the form of cash, gold or government Bonds before providing credit customers. This limitation is added by RBI on banks to make funds available to customers on-demand at your earliest convenience. Banks are required to maintain SLR at 18%. CRR (Cash Reserve Ratio): Banks are required to hold a certain proportion of their deposits in the form of cash. Banks don’t hold these as cash with themselves, but deposit such amounts with RBI / currency chests. CRR rate is at 4.5% currently. Repo Rate: The rate at which the RBI lends short-term money to the banks. The RBI through its Monetary Policy committee changes the repo rate to balance growth and Inflation. Reverse Repo rate: The rate at which banks park their short-term excess liquidity with the RBI. Now let us understand various terminologies for Banks Net Interest Income (NII): This is the spread the bank makes on its lending. It is calculated as Interest Income – Interest Expended Net Interest Margin (NIM): This is the spread the bank makes on its lending. It is the earning which is left after deducting the cost paid to depositors from its yields on Loans. This is denoted in % terms. The formula is Yield on Loans – Cost of funds Capital Adequacy Ratio (CAR): The capital adequacy ratio (CAR) is a measure of a bank's available capital expressed as a percentage of a bank's risk-weighted credit exposures. Essentially, it is the Capital that is available to lend. Tier I Capital – In simple words this capital is freely available with the bank to lend out. Tier II Capital- This is the capital tied up somewhere and is less freely available to lend. In case of an adverse event, the bank can use this capital to lend. Under Basel III norms, a bank’s tier 1+tier 2 capital must be a minimum of 8% of its risk-weighted holdings. The minimum capital adequacy ratio, also including the capital conservation buffer, is 10.5%. Current Account Saving Account (CASA)- There is no interest paid on the Current Account and a small interest rate is paid on a savings account. The combination of both is called CASA which shows the liabilities of the bank on which it pays relatively less interest. Deposits: Bank deposits are a savings product that customers can use to hold an amount of money at a bank for a specified length of time. In return, the financial institution will pay the customer the relevant amount of interest, based on how much they choose to deposit and for how long. Now let us come to NPA. Gross NPA (GNPA): It is the total loans on which no payment has been paid for 90 days or more. GNPA % is usually shown in each Bank’s quarterly results. The percentage is basically the GNPA amount as a % of the total advances. Slippages: Slippages denote the fresh amount of loans that have turned bad in a year. The slippage ratio of a bank is calculated as Fresh accretion of NPAs during the year /Total standard assets at the beginning of the year multiplied by 100. Provisioning Coverage Ratio (PCR): This is the ratio of provisioning to GNPA and indicates the extent of funds a bank has kept aside to cover loan losses. For Instance, a company has GNPAs of Rs 100 and they have set aside 50 Rs, then the PCR is 50%. Net NPA (NNPA): The total figure left after deducting provisions made for bad loans from GNPA. (GNPA – Provisions+upgrades/writeoffs = NNPA) Special Mention Account (SMA) SMA-0 is a category in which stress with respect to the principal and interest has remained overdue for a period of 0 to 30 days. SMA-1 is a category in which stress with respect to the principal and interest has remained overdue for a period of 30-60 days. SMA-2 is a category in which stress with respect to the principal and interest has remained overdue for a period of 60-90 days

..... . VALI disclosures . .....

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Wednesday, January 7, 2026

07/01/26, According to goodreturns.in

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Today's

15/01/26, Despite external pressures such as the Trump tariff threat and geopolitical uncertainties affecting investor sentiments, the Indian stock market is eagerly looking forward to the third-quarter earnings season, bolstered by significant monetary and fiscal reforms.

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