December Expiry Market Movement : Last Market Event of 2022

The Indian Stock Markets had a very mixed kind of year throughout 2022. The markets went up by huge margins from many lows and settled at a position which was already into effect 4 months back before the year ends. In other words the market took a lot of time to cross the all time highs. But once that was done they even tried to climb up the 19000 levels but due to instant selling by COVID situation in China, the market gains disrupted and settled near 18000 points before the expiry could end. The expiry witnessed a huge premium in the conversion of Nifty50 index for the 3rd consecutive time. This can be proof that whether the markets have gone down given the COVID fear, people are keen on converting their position for the next month as well. 

Stock Specific Movements

The entire market witnessed that the tech segment was a mega booster towards the end of the expiry period. Though the tech sector is already down by a huge margin one can never underestimate the stake it has in the NIfty50 index and the Sensex index as well. Hence the tech boost was like a headstart for the markets to enter in 2023. The tech sector did not gain more in terms of percentage but their overall weightage proves their importance in the Nifty50 gains. Apart from this the major gainers for the December month in the Nifty50 segment were ONGC with 6.32% gain, Hindalco with 6.14% gain and Tata Steel with 6.12% gain. 

Index Movement in December

The entire market went bizarre in the month of December. The month started with the Nifty50 having the 18800 level which was over the 52 week high point. However, December ended at 18105 points. Thus the markets were completely down in the month of December. The markets went down by 3.7% in the month of December itself. The Bank Nifty was comparatively flat. In other words the Bank Nifty started with 43100 levels and ended near 43150 levels which is nearly flat. 

Alongside this the Bank Nifty made an all time high in the month of December at 44049 levels. However the Bank Nifty was also available at a premium for conversion of position. This was its 3rd consecutive month with a premium conversion rate. This shows that the market participants are keen on conversion of their positions regardless of the outside scenario which can be a positive sign for the market momentum in the long run.

Overall Market Scenario

If we analyse properly than in major shares under the F&O segment, premium was seen for conversion of positions. The most fantastic gains were made by the future and options traders in the last hour of the last session of the year. The call index of 18100 CE was the most volatile under that point of time given the sudden spike in the prices of Nifty 50. Also the Nifty50 posted sudden gains at the end of the market session.

This gave a boost to all the stocks across all the segments and the markets ended on a positive note with a huge recovery posted by Nifty50. Post Nifty50 ended its last session of the year, SGX Nifty posted a gain of nearly 270 points and made it through the 18400 levels. However at the end of the next day the gains vanished due to the huge fall witnessed in the Dow Jones Index.

The Bank Nifty on the other hand also supported the gains and made a recovery of almost 300 points in the last 30 minutes of the market session. However the gains were the markets suffered in the entire month of December with Bank Nifty ending flat even though having an all time high levels and the Nifty50 ended 3.7% lower from the all time high levels.

Other Information

The major concerns raised at the end of the year was about the China Lockdown situation. Due to the widespread outbreak of COVID in China, many major provinces have been under a lockdown situation. Not only this the markets have been suffering due to the same. There has been an increase in prices of many raw materials that are based on Chinese exports. Hence one can say that the trade has started getting affected by the Chinese lockdown.

Also there are chances that if the situation gets bad this can lead to another COVID Outbreak in the world with the entire world coming to a halt once again. Hence one should be safe with their investments for the time period of one month and should also invest into the best companies which can be trusted. Alongside this major risk positions can be avoided for one month at least until the actual state of the situation gets clear.

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