MARKET PULSE:
Status: Uptrend Under Pressure
Highlights:
Three up days, one down day
Weekly Market Review:
On Tuesday, the benchmark indices started the holiday-truncated week on a bullish note, as the Nifty opened more than 100 points higher from Friday’s close. On Wednesday, the indices extended their gains. Yesterday, the market opened higher but failed to hold gains after it encountered resistance at higher levels. The benchmark indices ended yesterday’s session in the negative territory, with the Sensex picking up a distribution day. Today, the benchmark indices crossed those resistance levels and ended the day with significant gains.
The Nifty started the week at 9,893.30 and traded in the range of 9,831.05-9,989.35. The index closed for the week at 9,979.70, up 1.95% from last week’s close. After opening at 31,537.81, the Sensex gained 1.70% this week to settle at 31,814.22. The index traded in the range of 31,440.48-31,844.28.
This week, both the Nifty and the Sensex dropped one distribution day each, while the Sensex picked up a distribution day in yesterday’s session. This takes the current distribution day count to three on the Nifty and four on the Sensex. The Nifty and the Sensex are down 1.96% and 2.67%, respectively, from their all-time highs. The Indian market condition is currently in an Uptrend Under Pressure.
Broader indices made merry this week, as the Nifty Midcap and the Smallcap indices advanced 2.32% and 3.75%, respectively.
The MarketSmith IND 47 Index, which lists the top 47 stocks in chart and fundamental characteristics, gained 5.15% this week.
On the sectoral front, all the sectoral indices advanced higher this week. The top three gainers were the Nifty Energy, Metal, and, Pharma indices, rallying 4.95%, 4.54%, and 3.33% respectively.
The major economic event during the week was the RBI’s bi-monthly monetary policy meeting. The apex bank kept its key lending rate—the repo rate—unchanged at 6%, in line with the consensus view on the Street. The six-member monetary policy committee (MPC), headed by RBI Governor, Urjit Patel, pointed to the rising inflation that is perilously inching toward the RBI’s 4% threshold level, as it decided to not pay heed to calls from the Finance Ministry and the industry to cut rates to spur growth in the economy.
Signaling its crackdown on black money, the government today announced that it has collated information about 5,800 shell companies, whose earlier near zero-balance accounts saw nearly INR 4,574 crore of deposits post the demonetisation announcement and a withdrawal of INR 4,552 crore thereafter.
In stock news, Tech Mahindra has filed three cases against Reliance Communications and two of its subsidiaries in the National Company Law Tribunal (NCLT) under the Insolvency and Bankruptcy Code (IBC). According to reports, Reliance Communications and its two subsidiaries – Reliance Telecom and Reliance Big TV – owe Tech Mahindra INR 3.6 crore, INR 3 crore, and INR 1.5 crore, respectively.
The following events could serve as market movers in the coming week:
– Minutes of the U.S. Federal Open Market Committee (FOMC) meeting in September 2017, due on October 11.
– India Consumer Price inflation for September 2017 to be released on October 12.
Current Outlook:
– Be cautious with any new purchases.
– Make a defensive game plan for your portfolio.
– Stay disciplined and exercise sound sell rules.
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