Reported By:
| Edited By: Yogesh Vinod Mehta |Source: DNA |Updated: Jul 24, 2017, 07:25 AM IST
What a week that was!
In the Nifty tug of war between bulls and bears, last week started with a bang with bulls having full grip on the markets and Nifty reaching a new high of 9928 on Monday itself. The Nifty flip flopped making the week’s low of 9728 on the very next day and ultimately ended the week at 9915, a new closing high.
ITC nosedived 14% as government revised goods and services tax (GST) rates which are higher than erstwhile indirect tax rates, and have turned out to be a massive dampener for earnings expectations and even more for investor sentiment.
On the other hand, Reliance crossed all-time high on better Q1’18 result, GRM was highest at $11.9/bbl and regained its top slot position in terms of market capitalisation and announced 1:1 bonus to boot. Wipro announced buy-back of 7.6% of the equity at Rs 320 per share amounting to Rs 11,000 crore following Infosys and TCS. ICICI, SBI and HDFC have filed DRHP of their insurance companies IPOs for unlocking their shareholders’ values.
In the global events last week, BoJ and ECB kept rates unchanged and US markets were also at all-time highs and China GDP growing at 6.9%. The broad market kept in step with the Nifty which added a modest 0.29% to close at an all- time high of 9915. Over the week, the midcap index was almost unchanged while the small-cap index outperformed gaining 2.25%. IT, media and metals led the gainers adding 4%, 3% and 2% respectively, Wipro added 10%, HCL Tech 6%, Coal India and Hindalco added 4-5% each. FMCG sector went up in smoke thanks to a 14% drop in ITC. Nifty is above its R2 at 9798 and below its R3 at 10,033 for the July F&O series.
Last week, FIIs were again net buyers worth Rs 1,860 crore while DIIs sold worth 1,287 crore.
This week, US consumer confidence index on Tuesday, FOMC statement on Wednesday and US preliminary GDP rate for Q2 on Friday, will be keenly watched. In continuation of the Q2 result season companies like Ambuja Cement, HDFC Bank, IBull Hsg Fin, Zee, Axis Bank, Bharti Airtel, Idea, Hero Motocop, Pidilite, Vedanta, Bharat Financial, Federal Bank, HDFC, YES Bank, ICICI Bank, Biocon, Dr Reddy, HCL Tech, ITC, Maruti, LIC Housing Finance, L&T will announce their results.
It seems market is taking a pause or a step back before taking a leap above the 10000 mark. Quarterly results and July F&O series expiry on Thursday will keep markets volatile but the bull juggernaut are at its resilient best to accelerate the rally beyond 10000.
On weekly charts, Nifty has made “Dragon Fly” doji candlestick pattern which suggest bulls have strong grip on the markets and Nifty is in a strong uptrend, a break above 9950 can take it towards 10150–10250 zone and major support on the immediate basis remains at 9790.
The writer is head-retail research, Motilal Oswal Securities
