LAST WEEK
NIFTY opened with a gap-up at 15,853 on Monday but then moved down due to negative retail sales data from China. The index broke 15,970 on Tuesday and there was a huge short covering rally taking the index above 16,250. Wednesday saw a small fall. There was a huge fall on Thursday following the US markets as the retail segment stocks had fallen along with prevailing negativity around inflation. There was a rally on Friday with China reducing the 5 year LPR. NIFTY closed the week at 16,266, up by 484 points or 3.07%.
BANK NIFTY opened flat at 33,263. There was resistance at 33,700. The index moved higher the next day but faced resistance at 34,500 and fell heavily on Thursday. There was a strong support at 33,200 and the index moved up on Friday and closed the week at 34,276, up by 1155 points or 3.49%.
IT closed flat.
Foreign Institutional Investors net sold shares worth Rs 11,000 crores last week.
Domestic Institutional Investors net bought shares worth Rs 9,000 crores.
It is volatility everywhere. It was a hard week for positional traders with extreme volatility in the US markets. The west is down by 3%. At the same time, Indian markets have closed the week in the green though there was volatility.
China reduced the 5 year Loan Prime rate to revive the real estate sector in China. This influenced the market sentiments and we rallied. Bear markets always exhibit volatile pull-backs. Make sure that you do not fall trap in volatile moves.
There are reports that the US would overtake China in growth for the first time since 1976. The US is expected to post 2.8% growth whereas China’s growth would be 2% only.
Other major events of the week were:
Russia fired missiles near the Polish border. But the markets ignored.
LIC disappointed the investors without giving listing gains.
Adani will acquire AG’s cement businesses in India to become the second largest cement producer.
RBI Governor asked banks to watch geopolitical developments closely.
Finland and Sweden have submitted applications to join NATO.
HPCL Chairman said that Government level talks are going on to purchase Russian oil at discount.
China also is in talks to buy oil for strategic reserves.
Indonesia lifted the ban on palm oil exports.
There are reports that the US would overtake China in growth for the first time since 1976. The US is expected to post 2.8% growth whereas China growth would be 2% only.
SGX NIFTY is at 16,171.
INDIA VIX is at 23.1..
WEEK AHEAD
NIFTY has supports at 16,185, 16,100, 16,000.. We can expect resistances at 16,340, 16,410, 16,485, 16,600.
BANK NIFTY has supports at 34,000, 33,700, 33,400. Resistances are at 34,440, 34,700, 35,000 and 35,200.
NIFTY has the highest call OI build-up at 17,000 followed by 16,800. The highest put OI build-up is at 16,000 followed by 15,800.
BANK NIFTY has the highest call OI build-up at 35,000 and the largest put OI build-up is at 34,000.
Let us closely watch the US markets more this week as they are too volatile and the influence on our market can be large with Fed minutes on the table.
The minutes of the April meeting will be released on Wednesday. We have Powell and Bostic speaking on inflation on Tuesday and Monday respectively.
Major earnings the market is waiting for are that of Mahindra & Mahindra, SAIL, Zomato and ONGC. We have the IPO of Aether Industries opening on 24th May. Delhivery and Paradeep Phosphates will be listed this week.
You can also watch the GDP growth report of the USA on Thursday and CPI inflation data of Japan on Friday.
Let us not confirm strength in the market as we have seen such quick moves from the bottom recently as well. Watch the gap above 16,485. I will be watching 15,750 on the downside in the long term.
Let us know your expectations for the week in the comments section!