Last Week

The week gone by was one of intense profit booking in the market.

NIFTY opened the week with a big gap-up at 18,500 and formed a red candle. On Tuesday, the index opened at 18,600 but fell again. In fact, all 5 days of the week saw gap-ups and then a fall.

On Friday, the market tried to take support near Thursday’s lows and Nifty closed the day at 18,114, down 384 points or 2.08% from Monday’s opening.

Bank Nifty however showed strength throughout the whole week. The index opened at 39,800 on Monday and saw profit booking in the first 3 days of the week. On Thursday and Friday, the indices made strong green candles and closed at fresh all-time highs. Bank Nifty closed the week at 40,323, up 293 points or 0.73%.

Kotak Bank, ICICI Bank and HDFC were among the ones which kept NIFTY from falling below the 18k mark in the week.

All sectoral indices except Bank Nifty closed in the red for this week. Metal, FMCG, Pharma and Realty indices closed with losses of more than 5% this week.

The Midcap and Smallcap indices in NIFTY also saw selling, with both of them falling between 4-5%.

Over the week, many stocks announced their results and there were many stock specific movements. As an example, we can look at Federal Bank which rallied more than 10% in the week.

Chemical stocks, IRCTC, IEX and other stocks which were trending in the previous weeks fell sharply.

Foreign Institutional Investors(FIIs) have net sold Rs 7,353 crore worth of equity shares in the week. Domestic institutional investors(DIIs) also net sold Rs 4,504 crores worth of shares during the week. With this, FIIs have sold more than Rs 10,000 crores to date this month.

Week Ahead

Markets in the U.S including Dow Jones and S&P 500 are trading near their all-time highs, with NASDAQ still a bit far from this mark.

On Monday, the market will first react to results from Reliance and ICICI Bank. Reliance Q2FY22 results showed net profit jumped 11% YoY to Rs 13,680 crores, beating street estimates. Do check out this article to see an in-depth analysis of Reliance Q2 results.

ICICI Bank‘s 30% YoY jump in net profit also beat Street estimates by a big margin.

Asian Paints reported nearly a 30% YoY fall in net profits blaming it on inflation and rising crude oil prices.

20 companies from NIFTY 50, for a total weightage of more than 25% are set to announce their results this week including Kotak Bank, Axis Bank and L&T.

The highest call OI stands at 18,200 followed by good call writing in 18,300, 18,400 and 18,500. There is low put buildup in the market with Highest Put OI is at 18,000 followed by 18,500.

The oil prices in the international markets are going up again with Brent crude futures hitting a fresh three-year high of $86.10. Coal and gas prices also continue to move up.

SGX Nifty closed below 18,152 yesterday, slightly in the green.

India VIX, which measures the expected volatility in the market, increased by 11.29% this week.

If you plot a channel in NIFTY from late July, you can see that the index has now taken support at the lower level of this channel. If the market bounces back, the resistances to watch out in Nifty would be 18,300, 18,450 and 18,600 on the way up.  

On the lower side, the first support zone to be watched out for is at 18,000, and then at 17,900 and 17,680.

There are also two IPOs this week Nykaa and Fino Payments Bank, which we will surely be covering.

What do you think will happen to Nifty this week? Will we see support taken at 18,000 or further profit booking? Let us know what you think in the comments section of the marketfeed app.