By Gaurav Bora (Market Expert)
Market shown historic gains in the past week as consistent FIIs inflow, GDP data and auto sales drove the Sensex beyond 58,000 and the Nifty above 17,300 marks. Friday market closed on high and entered into uncharted territory with high liquidity 17,575 can be seen in coming week. Sensex climbed 2,005.23 points (3.57%) to 58,129.95 and Nifty moved 618.40 points (3.70%) to 17,323, while the broader market outweighed with the Nifty Midcap 100 rose (5%) and Smallcap 100 climbed (4%) during the week. The rally was across sectors with auto, bank, energy, infra, metal, pharma, and oil & gas indices rising 3-6% each. Real Estate was the biggest gainer with nearly 11% gains. Market could see some consolidation but overall may continue it’s up move but focus on global cues, IIP data and Covid-related updates. After couple of weeks of selling, FIIs returned to India with substantial amount of inflow on the back of very dovish commentary of US Fed Chair Jerome Powell in the speech at Jackson Hole. FIIs have net bought Rs 6,867.73 crore worth of shares in the last week, whereas DIIs seems to have preferred profit booking as they net sold Rs 1,421.12 crore.
Global markets have played an important role in the recent momentum and it will play a key role in the coming week for further upside in Indian markets. The market will remain shut on September 10 on the occasion of Ganesh Chaturthi. IIP data for the month of July is the key data to watch out for in the coming week, which is scheduled on Friday. The growth to be in double digits and largely around similar lines of June data, with the strong manufacturing PMI data and easing covid restrictions in India and increased economic activity. Apart from economic data Covid-related updates and the speed of vaccination will also be closely watched going ahead. India consistently added more than 40,000 daily cases in last couple of days along with rising in active cases but still remained under control becouse of increased speed of vaccination across the country. Rising COVID-19 cases in Kerala, Maharashtra, Karnataka, Tamil Nadu and Andhra Pradesh. The count of people vaccinated with first dose stood at over 51.98 crore and more than 15.73 crore people completed their second Covid vaccine dose. Apart from IIP, deposit & bank loan growth for the fortnight ended August 27 and foreign exchange reserves for week ended September 3 will also be released on Friday.
Key factors for the week:
- IIP Data
- Rising COVID 19 cases
- Global Markets & FIIs Inflows.
The Nifty formed bullish candle on the daily as well as weekly charts as it closed on record high on Friday, indicating the continuity in overall positive momentum going ahead. But consolidation can’t be ruled out in the coming week considering the sharp momentum in the last week. There is a possibility of further upside in Nifty for the next week towards 17,575 levels. The crucial supports is placed around 17,200 and 16,900 levels respectively. If Nifty sustains 17,315 levels then we may see momentum towards 15,575 and 15,956, while below 17,194 will act as support. The maximum Put open interest at 17,200 followed by 17,000 strike and is also likely to act as a major support in the coming week. Maximum call open interest at 17,500 followed by 18,000 and is also likely to act as a major resistance in the coming week. Nifty could trade in the range between 17,000-18,000. The volatility index IndiaVIX moved up from 13.40 to 14.54 levels, Stability in the volatility and declines from higher zone suggests that bulls are seating in the comfortable position in the market.