Last Week in Nifty
Nifty opened the week at 16,592 on Monday and fell down sharply. There was good support taken at 16,400, and this level was not seen at all later.
In the rest of the week, Nifty shot up crossing major levels nearby. Nifty ended the week at 16,705 after hitting an all-time high of 16,722.
The broader markets outperformed in the week with smallcap and midcap indices bouncing back up.
Yesterday, US Federal Reserve Chairman Jerome Powell hinted about slowing down bond purchases by the end of 2021, to slow down liquidity in the economy. He also added that there are no plans to change interest rates.
Auto stocks were weak with Maruti falling 3.3% in the bullish week and the auto index was in the red. Tata Motors was however flat and might be a sign of strength for the coming week.
Reliance moved up slowly in the week along with a green closing in HDFC Bank.
Insurance stocks NIACL and GICRE moved up in the week after FM Nirmala Sitharaman indicated possible privatisation of the companies.
Bank Nifty continued to remain in its consolidation zone around 35,000 and 36,000 if we leave out the Monday fall. Bank Nifty closed the week at 35,627, up nearly 200 points from Monday’s opening.
Metals gained back slowly after last week’s fall with the FMCG index closing with only small gains.
Foreign Institutional Investors net sold Rs 6,833.33 crores worth of shares in the week, with currently the month’s net outflow now over Rs 7,600 crores. Domestic Institutional Investors have bought for over Rs 8,000 crores this month.
Week Ahead in Nifty
Nifty gave a small breakout by Friday in the week, and bullishness is expected to continue. 16,700 will be good support after opening tomorrow.
Reliance and HDFC Bank movements are expected to continue. These stocks are the heavyweights of Nifty.
The highest call OI stands at 16,700 and 17,000. Highest Put OI is at 16,600 followed by 16,700. The strong call and put Open Interest at 16,700 indicate consolidation for the week.
16,500 will be the first important support zone for the zone for Nifty with stronger support at 16,300.
Bank Nifty struggle continues and the support at 35,000 will have to be watched. The breakout we expect might also be around the corner as the open interest data shows slight bullishness.
GDP Data for the first quarter of FY22 will be released on Tuesday. Manufacturing PMI, auto sales data and more are also expected in the first week of September.
Jerome Powell’s remarks had pushed up SGX Nifty to above 16,800 yesterday. But the Afghanistan blasts and retaliation by the U.S. forces creating fear in the market.
Retail participants are planning to stay away from trading on September 1st, with #notradingday trending on Twitter. This is to show protest against SEBI’s new margin rules, which lower leverages for intraday trading. We may also see reduced volumes in the market.
What do you think will happen to Nifty this week? Will you be observing the #notradingday on September 1st? Let us know in the comments section of the marketfeed app.