MARKET PULSE
Status: Uptrend Under Pressure
Highlights:
Three up days, two down days
Weekly Market Review
The benchmark indices came under the grip of the market bears, due to persistent geopolitical pressures. The Nifty and the Sensex halted their recovery run as North Korean tensions sprung back to focus.
On Monday, the market started on a negative note reacting to the news of a fresh nuclear test conducted by the North Korean military over the weekend. Unending woes from the Korean Peninsula dragged down the markets across Asia. As the week progressed, the benchmark indices tried to grow higher, but faced stiff resistance due to geopolitical concerns. In a battle between bulls and bears, the latter emerged victorious as the key indices recorded significant losses by the end of this week.
The Nifty started the week at 9,984.15 and traded in the range of 9,861.00-9,988.40. The index closed for the week at 9,934.80, down 0.40%. After opening at 31,932.20, the Sensex gave up 0.64% this week to close at 31,687.52, trading in a range of 31,560.32-31,932.20.
This week, the Nifty and the Sensex added a new distribution day, each, while the Sensex dropped one from its tally due to ageing. This takes the current distribution count to 7.0, for each of the benchmark indices. The Nifty and the Sensex are about 2% and 3% away from their all-time highs, respectively. The Indian market condition remains in Uptrend Under Pressure.
This week belonged to the Nifty Midcap and Smallcap indices, which reclaimed their all-time highs despite weakness seen in frontline composites. However, Friday’s losses trimmed weekly gains of the Nifty Midcap and Smallcap indices to 0.37% and 0.56%, respectively.
The MarketSmith IND 47 Index, which lists the top 47 stocks in chart and fundamental characteristics, sharply outperformed all other major indices by recording a gain of 1.44% this week.
On the sectoral front, the Nifty Metal (+3.12%), Media (+0.41%) and Financial Services (+0.18%) indices were the only sectors to post gains. During this week, the Nifty Pharma, PSU Bank, and FMCG indices declined the most with losses of 2.55%, 2.31%, and 1.92%, respectively.
Fresh economic data released during the week suggest that the Indian service sector continues to be adversely impacted by the launch of GST. The Nikkei India Services PMI Index for August stood at 47.5. The service sector witnessed a contraction for a second consecutive month. However, the downturn was less severe compared to 45.9 in July.
The following events could serve as a market mover in the coming week:
– August Consumer Price Index data: September 12, 2017
– August Wholesale Price Index data: September 14, 2017
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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