This week marked a notable performance in the Indian stock market, with both the BSE Sensex and Nifty50 indices displaying significant strength. The BSE Sensex surged by 0.77 percent, gaining 500.65 points to reach a closing level of 65,387.16. Simultaneously, the Nifty50 index also showed resilience, adding 0.87 percent and concluding the week at 19,435.30.
The positive momentum in the market was primarily driven by encouraging economic indicators. Strong GDP figures and robust manufacturing PMI data for the first quarter of the fiscal year provided a boost to investor confidence. These favorable economic signals helped the benchmark indices break a five-week losing streak, overshadowing concerns such as a weak monsoon, rising crude oil prices, and mixed global market trends.
What's noteworthy is that it wasn't just the large-cap indices that demonstrated resilience. The broader market segments outperformed expectations, with the BSE Mid-cap, BSE Small-cap, and BSE Large-cap indices recording gains of 2.3 percent, 3.8 percent, and 1 percent, respectively.
Shrikant Chouhan, Head of Equity Research (Retail) at Kotak Securities, commented on this week's market performance, emphasizing that "Indian equities posted healthy gains." Both the BSE-30 and the NSE-50, representing large indices, delivered weekly returns of close to 1 percent, showcasing the broad-based optimism in the market. Chouhan also noted that mid-cap and small-cap indices in India outperformed their large-cap counterparts, indicating a well-rounded market rally.
In terms of sectoral performance, the BSE Metals and BSE Realty indices took the spotlight, with weekly gains exceeding 5 percent. Additionally, sectors such as BSE Commodities, BSE Auto, BSE Capital Goods, and BSE Power posted robust weekly gains. However, the BSE FMCG index experienced a 0.5 percent decline during the week.
Chouhan added that "India's real GDP growth in Q1FY24 came in at 7.8 percent," further contributing to the positive sentiment in the market. He also highlighted that the market would closely monitor the impact of a weak monsoon in August and the rise in crude oil prices in the near term.
In terms of sector-wise performance, the BSE Metal index registered an impressive 6 percent jump, while the BSE Realty index surged by 5.7 percent. The BSE Telecom index climbed 4.5 percent, and both the BSE Power and Auto indices saw gains of 3.4 percent each. In contrast, the BSE FMCG index experienced a 0.5 percent decline.
The BSE Small-cap index emerged as a standout performer, surging by 3.8 percent. Several small-cap stocks made notable gains, including Railtel Corporation of India, India Pesticides, Optiemus Infracom, HLV, Take Solutions, RattanIndia Power, Atul Auto, Jai Balaji Industries, Gokaldas Exports, Cerebra Integrated Technologies, Pokarna, Uflex, Coffee Day Enterprises, Skipper, and Sharda Motor Industries, all recording gains ranging from 25 to 46 percent.
On the flip side, GNA Axles, Digispice Technologies, Kuantum Papers, Waaree Renewable Technologies, Newgen Software Technologies, and Electronics Mart India witnessed declines ranging from 10 to 46 percent.
Foreign institutional investors (FIIs) continued their selling trend for the sixth consecutive week, divesting equities worth Rs 4,311.58 crore. In contrast, domestic institutional investors (DIIs) exhibited a contrasting trend by purchasing equities worth Rs 9,570.03 crore. For the month of August, FIIs sold equities worth Rs 20,620.65 crore, while DIIs bought equities worth Rs 25,016.95 crore.
**Nifty50 Outlook**
Amol Athawale, Vice President - Technical Research at Kotak Securities, analyzed the daily and intraday charts of the Nifty and identified a double bottom formation, indicating a strong possibility of an upcoming rally. A long bullish candle on the daily charts further supported the case for a continued uptrend. Key support was expected at 19,350, while the index could potentially rally towards 19,575. However, a breach of support at 19,350 might expose the uptrend to potential declines towards 19,275-19,220.
For Bank Nifty traders, the crucial support level was identified at 44,200. A move above this support could lead to gains towards 44,700 and 45,000. Conversely, a breach of 44,200 could result in a retreat towards 43,900-43,700 levels.
Jatin Gedia, a Technical Research Analyst at Sharekhan by BNP Paribas, provided a technical perspective on the Nifty's performance. He noted a notable rebound from the 19,250 zone, where buying interest emerged. Daily and hourly momentum indicators signaled a positive crossover with divergence, indicating a bullish outlook in the short term. Additionally, on the weekly charts, the Nifty managed to close in positive territory after five consecutive weeks of decline, suggesting that it has reached a region where buying interest is evident.
In conclusion, the Indian stock market displayed remarkable strength during the week, fueled by positive economic data and robust sectoral performances. While there are potential challenges on the horizon, such as a weak monsoon and rising crude oil prices, the short-term outlook appears optimistic, with key support and resistance levels to monitor in the Nifty and Bank Nifty indices.
The positive momentum in the market was primarily driven by encouraging economic indicators. Strong GDP figures and robust manufacturing PMI data for the first quarter of the fiscal year provided a boost to investor confidence. These favorable economic signals helped the benchmark indices break a five-week losing streak, overshadowing concerns such as a weak monsoon, rising crude oil prices, and mixed global market trends.
What's noteworthy is that it wasn't just the large-cap indices that demonstrated resilience. The broader market segments outperformed expectations, with the BSE Mid-cap, BSE Small-cap, and BSE Large-cap indices recording gains of 2.3 percent, 3.8 percent, and 1 percent, respectively.
Shrikant Chouhan, Head of Equity Research (Retail) at Kotak Securities, commented on this week's market performance, emphasizing that "Indian equities posted healthy gains." Both the BSE-30 and the NSE-50, representing large indices, delivered weekly returns of close to 1 percent, showcasing the broad-based optimism in the market. Chouhan also noted that mid-cap and small-cap indices in India outperformed their large-cap counterparts, indicating a well-rounded market rally.
In terms of sectoral performance, the BSE Metals and BSE Realty indices took the spotlight, with weekly gains exceeding 5 percent. Additionally, sectors such as BSE Commodities, BSE Auto, BSE Capital Goods, and BSE Power posted robust weekly gains. However, the BSE FMCG index experienced a 0.5 percent decline during the week.
Chouhan added that "India's real GDP growth in Q1FY24 came in at 7.8 percent," further contributing to the positive sentiment in the market. He also highlighted that the market would closely monitor the impact of a weak monsoon in August and the rise in crude oil prices in the near term.
In terms of sector-wise performance, the BSE Metal index registered an impressive 6 percent jump, while the BSE Realty index surged by 5.7 percent. The BSE Telecom index climbed 4.5 percent, and both the BSE Power and Auto indices saw gains of 3.4 percent each. In contrast, the BSE FMCG index experienced a 0.5 percent decline.
The BSE Small-cap index emerged as a standout performer, surging by 3.8 percent. Several small-cap stocks made notable gains, including Railtel Corporation of India, India Pesticides, Optiemus Infracom, HLV, Take Solutions, RattanIndia Power, Atul Auto, Jai Balaji Industries, Gokaldas Exports, Cerebra Integrated Technologies, Pokarna, Uflex, Coffee Day Enterprises, Skipper, and Sharda Motor Industries, all recording gains ranging from 25 to 46 percent.
On the flip side, GNA Axles, Digispice Technologies, Kuantum Papers, Waaree Renewable Technologies, Newgen Software Technologies, and Electronics Mart India witnessed declines ranging from 10 to 46 percent.
Foreign institutional investors (FIIs) continued their selling trend for the sixth consecutive week, divesting equities worth Rs 4,311.58 crore. In contrast, domestic institutional investors (DIIs) exhibited a contrasting trend by purchasing equities worth Rs 9,570.03 crore. For the month of August, FIIs sold equities worth Rs 20,620.65 crore, while DIIs bought equities worth Rs 25,016.95 crore.
**Nifty50 Outlook**
Amol Athawale, Vice President - Technical Research at Kotak Securities, analyzed the daily and intraday charts of the Nifty and identified a double bottom formation, indicating a strong possibility of an upcoming rally. A long bullish candle on the daily charts further supported the case for a continued uptrend. Key support was expected at 19,350, while the index could potentially rally towards 19,575. However, a breach of support at 19,350 might expose the uptrend to potential declines towards 19,275-19,220.
For Bank Nifty traders, the crucial support level was identified at 44,200. A move above this support could lead to gains towards 44,700 and 45,000. Conversely, a breach of 44,200 could result in a retreat towards 43,900-43,700 levels.
Jatin Gedia, a Technical Research Analyst at Sharekhan by BNP Paribas, provided a technical perspective on the Nifty's performance. He noted a notable rebound from the 19,250 zone, where buying interest emerged. Daily and hourly momentum indicators signaled a positive crossover with divergence, indicating a bullish outlook in the short term. Additionally, on the weekly charts, the Nifty managed to close in positive territory after five consecutive weeks of decline, suggesting that it has reached a region where buying interest is evident.
In conclusion, the Indian stock market displayed remarkable strength during the week, fueled by positive economic data and robust sectoral performances. While there are potential challenges on the horizon, such as a weak monsoon and rising crude oil prices, the short-term outlook appears optimistic, with key support and resistance levels to monitor in the Nifty and Bank Nifty indices.
