MARKET PULSE
Status:
Confirmed Uptrend
Highlights:
Four up days, one down day
Weekly Market Review:
The Indian stock market brushed aside escalating trade war concerns to pocket strong gains for the second week in a row. Nifty and Sensex climbed 2.2% and 2% higher, respectively, during the week.
The much-awaited follow-through day finally arrived on Thursday, as investors cheered RBI’s optimistic outlook for the Indian economy in FY 2019. The apex bank projects FY 2019 GDP growth to touch 7.4% and also lowered inflation forecast.
The week began on a strong note, as both the key indices brought home good gains amid strength in the global equity markets.
Late-session buying helped India’s frontline indices to close with modest gains on Tuesday.
With trade war fears spooking investors, Wednesday’s session was marred with losses of more than 1%.
Bulls took centre stage on Thursday, as market sentiment was boosted following RBI’s bi-monthly meet. India’s key indices followed-through, bringing a change in market condition to a Confirmed Uptrend.
After struggling in negative territory for most part of the session, the major indices did well to end with miniscule gains on Friday.
All in all, the Indian stock market stood tall in the midst of a global trade spat between the world’s two largest economies, the U.S. and China.
After the U.S. slapped tariffs on steel and aluminum imports and additional $50 billion worth of Chinese goods, China retaliated in equal proportion and put the ball in U.S. court. The trade dispute is not showing signs of ending soon, as Donald Trump is now exploring options to charge more tariffs on other Chinese goods.
Amid trade war concerns and upcoming earnings season, institutional investors chose to remain on sidelines for most part of the week.
In the broader market, both the Nifty Midcap and Smallcap indices outperformed their major counterparts, posting gains of 4.1% and 5.3%, respectively.
From the sectoral point of view, all the indices ended in green, led by Nifty Auto (5.8%), PSU Bank (5.1%) and Pharma (+4.7%).
MarketSmith India’s IND 47 index, our proprietary list of top 47 stocks in chart and fundamental characteristics, outshone the overall market by advancing 5.5% this week.
Talking about market direction, we changed the market status to a Confirmed Uptrend, following Thursday’s strong action. In the week gone by, we saw some good names breaking out of sound chart patterns along with the new high list getting populated for the first time in two months.
In the coming week, following events could serve as market movers:
- Industrial Production Data for February 2018: April 12, 2018
- Inflation Rate for March 2018: April 12, 2018
- Manufacturing Production Data for February 2018: April 12, 2018
Current Outlook:
– Market environment conducive for purchases, but remain selective.
– Focus on fundamentally strong stocks breaking out of strong technical patterns.
– Stay disciplined and exercise sound buy and sell rules.
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