The Indian markets closed in the green on Friday as S&P BSE Sensex regained 60,000-mark, while Nifty50 ended the last session of the week only a few points short of 17,900. Sensex added 381 points, while Nifty50 gained 105 points to close at 60,059 and 17895, respectively.    

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Nifty50 and Sensex both closed the week with over 2% gain. Nifty50 gained 2.1 % and Sensex gained 2.2% aided by IT and consumer durable shares for the week ended October 8, 2021. Nifty IT and S&P BSE consumer durables stocks gained maximum in the domestic equity market benchmarks surge in the last week. In the broader market, Nifty Next50 index declined by 0.23% or 100 points to 43,270.70, Nifty Midcap50 closed in the green after gaining 39 points or 0.45% to 8,592.15.     

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Among sectoral indices, Nifty bank closed flat with positive bias and Nifty Financial Services ended negative. Nifty bank closed Friday's session at 37,775.25, up 22.05 points or 0.06%, while Nifty Financial Services shed 63 points to close at 18,274.10.       

Weekly market outlook: Experts' take 

Speaking about the stock market performance in the last week, Vinod Nair, Head of Research at Geojit Financial Services, said, "The domestic market was volatile during the 1st half of the week as global worries over US debt default along with rising bond yield and crude oil price weighed investor sentiments.  However, as global worries cooled off with easing bond yield and crude price, the domestic market started gaining momentum."    

He further said the expectation of good quarterly numbers and the dovish policy measures by RBI in their bi-monthly policy announcement helped in adding investor confidence. "RBI kept rates unchanged and maintained the status quo on accommodative stance. FY22 GDP growth was maintained at 9.5% while trimming inflation worries by lowering CPI forecast from 5.7% to 5.3%, providing the push to the market," said the market expert.     

Despite the global semiconductor shortage, auto stocks rallied in hopes of demand revival during the festive season, he said.    

"It was a good week for the Indian market where it outperformed most of its global peers amid worries of global energy crises and inflation worries. IT and Auto sector added most of the gain while the broader market also did well with a gain of more than 3.5%. Infosys, Wipro, and HCL tech will come out with their numbers next week therefore we are going to see lots of volatility in the market, especially in the IT sector, " said Santosh Meena, Head of Research, Swastika Investmart Ltd. 

We have collated a list of 10 factors that could dictate the trend on D-Street in the coming week:      

1 Corporate Earnings:    

With the Tata Consultancy Services (TCS) Ltd kickstarting the earnings season on Friday, there are several companies lined up to present their September Quarter results next week. HDFC Bank, Infosys, Wipro, HFCL, Delta Corp, Tata Metaliks Ltd, GM Breweries, Mind Tree, Cyient Ltd, Avenue Supermarts Ltd, Tata Coffee, Alok Industries, Ultratech cements and many more will come with their September quarter numbers in the coming week.     

Talking about Q2 corporate earnings, Geojit Financial Services Head of Research Vinod Nair said "In the coming week, domestic investors will shift their focus to Q2 corporate earnings. The IT sector will be in key focus as they are scheduled to release earnings in the coming days."    

2 September Inflation Data:    

September inflation data will be another factor that would decide the mood of the share market going forward in the next week.  "The domestic market awaits the release of September inflation data which is expected to settle below 5%. Globally, investors have the release of US jobs data on their radar to determine the course of the global markets in the coming week," said Vinod Nair.   

The government will release IIP and CPI numbers on 12th October and WPI will be announced on 14th October. "Along with corporate earnings, the market has to deal with macro numbers. The market is expecting strong growth in industrial production but at the same time, it worries about inflation," Santosh Meena.  

3 Air India-Tata Deal  

Tats Sons in a historic bidding on Friday won back Air India for Rs 18,000 crore. The official confirmation about this acquisition came after the market was closed on Friday. It is expected that the deal will impact aviation and PSU bank shares. "Tata wins back Air India that is a historical moment and this is a sigh of relief for the lenders.  PSU banks mainly the Bank of Baroda will be the biggest beneficiary as it has substantial exposure to the airliner. If we talk about the Airline stocks, then competition will increase so we could have a sentimental negative impact on listed players, but the opportunity of scale is high so the long-term outlook is positive for the overall industry, " said Swastika Investmart Ltd Head of Research. 

4. Technical View:   

Nifty is trading near-critical resistance zone of 17950-18000 where it could again witness selling pressure, but if it manages to trade above this zone then we could see a rally towards 18200/18300 levels. On the downside, 20-DMA of 17650 is immediate and important support; below this, 17450 is a critical support level as below 17450, we could see any meaningful correction.   

Bank Nifty is trading near-critical resistance zone of 3800-38300; above this, we can expect a strong short-covering rally towards 39000, otherwise there is a risk of profit booking where 20-DMA of 37500 is critical support; below this, we can expect further selling pressure towards 36500/36000 levels.      

"If we talk about the data then the market is lacking FIIs' buying, but getting strong support from DIIs, HNIs, and retail investors. Put call ratio stands at 1.3 level, whereas FIIs' long exposure in index future stands at 59% that is neutral to positive. On the options front, the 18000-strike call option has the highest OI of 37lac for14-Oct expiry, while the 17800-strike put has the highest OI 32.7lac, therefore 18000 is an important and psychological hurdle," said Meena. 

5 Launch of weekly futures contracts in dollar-rupee currency pair    

The National Stock Exchange (NSE) will launch weekly futures contracts in the US dollar-Indian rupee (dollar-rupee) currency pair from October 11, as per NSE release. There will be 11 weekly futures contracts available for trading. This will exclude the ‘expiry’ week where the monthly contract expires on Friday. According to the release, the deal size will be $1,000 and will be available for trading in the currency derivatives segment of the exchange. Earlier, NSE had started weekly options trading for the dollar-rupee currency pair on December 3, 2018. 

6 Corporate Actions:    

The week starting October 11 has also major corporate actions lined up.     

*Gensol Engineering Ltd   

Ex-date for share split has been fixed by the company as October 11 and the record date for the same is October 12. The share has been proposed to split in 1:3 bonus ratio.     

*DCM Shriram   

DCM Shriram has scheduled Monday as Record Date of stock split. The split ratio decided is 1:5 equity shares.     

*Thejo Engineering Ltd   

Thejo Engineering Ltd bonus split has been decided in the 2:1 ration and the ex-date and record date for it has been fixed as 12 and 13 October, respectively.  

*Kesoram Industries  

Kesoram Industries’ rights issue will be closed on Monday with Entitlement Ratio at 133:274; Issue Price is set at Rs 50 per share and size at 7,99,99,665 equity shares.    

*RPP Infra Projects   

RPP Infra Projects will also close its rights issue of Rs 48 crore; Issue Price set at Rs 30 per share and Entitlement Ratio at 3:5.    

*Tata Consultancy Services (TCS)  

Tata Consultancy Services Board will meet to consider interim dividend on October 14. TCS Ltd has reported Q2 profit at Rs 9624 cr and declares second interim dividend at Rs 7/share, ex-date for which is October 14. The record date is October 18  

7 Global Cues   

The S&P 500 ended slightly lower on Friday (October 8) after data showed weaker jobs growth than expected in September, yet investors still expected the Federal Reserve to begin tapering asset purchases this year, said a Reuters Report.  The Dow Jones Industrial Average fell 8.69 points, or 0.025%, to 34,746.25. The S&P 500 lost 8.42 points, or 0.19%, to end at 4,391.34 points, while the Nasdaq Composite lost 74.48 points, or 0.51%, to 14,579.54.   

Asian Market largely closed in the green amid Chinese share market resuming trade after a week-long holiday, on Friday. Japanese Nikkei closed 371 points up at 28,049 and Hang Seng Index at 24,838, up 136 points. Talking about global factors, Meena said, " Global factors will also play an important role in the direction of the market.  The headline numbers of US Nonfarm payroll are slightly weak however the internals are strong. The US bond yield is above the 1.6 mark, the Dollar index is above 94 and the price of Brent crude is above $83 that may lead to any correction in the market however market is ignoring all of them for time being as momentum is very strong." 

8 FII & DII Activity in Cash market:   

As per the latest data till date, Foreign institutional Investors (FIIs) and DIIs were net seller with Rs 64.01 crore Rs 168.19 crore in the cash market.   Foreign institutional investors (FII) or foreign portfolio investors (FPI) refers to investors from other countries which put money in Indian stock markets. Domestic institutional investors (DII) comprise local mutual funds, insurance companies, local pension funds, and banking and financial institutions. 

9 Primary Market   

Aditya Birla Sun Life AMC IPO will be listed on exchanges on Monday, October 11, as per broker Upstox. Aditya Birla Sun Life Asset Management IPO, which opened on September 29, was subscribed 5.25 times on the closing day of the subscription.  The Rs 2,768.25-crore initial share sale received bids for 14,59,97,120 shares against 2,77,99,200 shares on offer, as per NSE consolidated bid details.     

10 Rupee   

The rupee tumbled 20 paise to close at 74.99, down 20 paise over its previous close, against the US dollar on Friday, as rising crude oil prices weighed on investor sentiment, even as the domestic equities ended with handsome gains, said PTI. At the interbank foreign exchange market, the local currency opened at 75 and witnessed an intra-day high of 74.91 and a low of 75.16 against the US dollar in day trade.