Market Pulse:
Highlights:
Three up and two down days
Weekly Market Review:
Amid heightened global trade war concerns, Indian benchmark indices held onto their gains.
The week began on a grim note on Monday, as the Nifty faced high-volume selling, mirroring a weak global market sentiment. With a loss of 0.5% on the index, it turned out to be a distribution day. The Sensex escaped the brunt of distribution on account of low volume.
Market recovered from a negative opening on Tuesday to close with modest gains. Investor sentiment improved following speculations of the People Bank of China preparing to take tougher action against the plunge in the yuan.
On Wednesday, the Indian government’s decision to raise the minimum support price (MSP) for Kharif crops boosted market sentiment. The Nifty and the Sensex scored decent gains of 0.7% and 0.8%, respectively.
Major indices traded in a narrow range on Thursday, before ending about 0.2% lower. Volumes on the Sensex were higher than the previous session, resulting in a distribution day on the index.
With the U.S. tariffs on Chinese imports becoming a reality on Friday, major indices remained mostly range-bound. Eventually, the Nifty and the Sensex settled with weekly gains of 0.5% and 0.7%, respectively.
In the broader market, the Nifty Midcap and Smallcap indices moved higher by 0.2% and 0.6%, respectively.
On the sectoral front, strength was mainly spotted in the Nifty Auto (+3.4%), FMCG (+1.3%), and Private Bank (+0.6%). On the downside, Nifty Metal (-3.4%), Realty (-1.6%), and Media (-0.9%) tumbled due to selling pressure.
MarketSmith India’s IND 47 index, our proprietary list of top 47 stocks in chart and fundamental characteristics, gained 0.6%.
Talking about economic data, the Nikkei India Manufacturing PMI inched higher to 53.1, the highest since the beginning of this year. The Nikkei India Services PMI came at 52.6 in June, the highest in the last 12 months.
During the week, both the Nifty and the Sensex added one distribution day. On Sensex, one distribution day fell off the count due to age. The distribution day count now stands at five on both the leading indices.
With the distribution count staying at an elevated level and the market continuing to struggle for direction, the market condition remains unchanged at an Uptrend Under Pressure. For the market to move to a Confirmed Uptrend, the Nifty needs to reclaim its previous high of 10,929.20. On the downside, 10,550 and 10,400 are crucial support levels for the index.
Market participants will shift their focus to Q1 results season, with IndusInd Bank and Tata Consultancy Services expected to report earnings on July 10. In the coming week, the following events could serve as market movers:
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CPI inflation data: July 12
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Manufacturing production data for May: July 12
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Industrial production data for May: July 12
Current Outlook:
– Be cautious with any new purchases.
– Form a defensive game plan for your portfolio.
– Stay disciplined and exercise sound sell rules.
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