2023-09-10 15:53:27
RaIn the last week, the international market has been reeling on Fed fear, and the Indian market has made good progress, supported by the G-20 sentiment. The Indian market, which started to recover from Friday following the collapse on the F&O closing day of the previous week, has gained regarding one and a half percent in the last week. The public sector stock index advanced over 5% while realty and energy sectors gained over 4%, infra, public sector banks and small & mid cap sectors gained over 3% in the last week. The IT sector gained 2% last week.
In the first days of the week, Nifty came above the 50-day moving average and buying was evident in banking stocks, which favored the Indian market. Wednesday’s buying in HDFC Bank laid the foundation for the Indian market’s further advance. Nifty, which closed at 19819 points following moving up to 19867 points on Friday, may find support near 19500 points which is 50 DMA if it misses support at 19600 points. After crossing 19880 points, Nifty’s next resistance is at 19960 points before correcting the record.
In the absence of China, India’s progress in the G20 meeting in India is attracting the most attention. The railway from India to the Middle East and so on will give India an upper hand in trade in the Middle East.
Indian corporates have already made gains before the start of the G20 meeting, including an agreement for ship repairs with the US Navy’s Mazagon dock, and support for Indian liquor in G20 duty-free deals. The G-20 meeting is expected to bring more benefits to the Indian corporate world.
PCE data, which influences Fed decisions, was in line with market assumptions, and US GDP did not meet market expectations, raising market expectations that the Fed would not raise rates, which led to the market advance in the previous week. But the American data, including the services PMI and job data that came out last week, showed that the Fed Reserve is in favor of a rate hike, so the world market got tired last week. The dollar and US bond yields advanced last week on the back of the Fed Reserve rate hike threat, followed by a correction in European markets along with US markets and Asian markets excluding India.
The decision of the next meeting of the American Fed Reserve on September 20 is crucial for the world market. US retail inflation figures due on Wednesday might trigger big swings in world markets as they signal Fed decisions.
Crucial for the US market is the release of CPI data, which indicates US retail inflation figures, on Wednesday, and PPI data, which is the factory gate price index, on Sunday. In July, annual growth came in at 3.2%, better than market estimates, which was positive for the market. Annual growth in core CPI also slowed to 4.7%, better than market estimates.
Key for the US market will be Thursday’s retail sales data, Friday’s industrial production data, and the University of Michigan’s consumer sentiment and inflation estimates.
British unemployment rate on Tuesday, Spanish CPI data and British GDP-industrial production figures on Wednesday might influence European markets. French and Italian CPI figures and German PPI figures are out on Friday.
China’s industrial production figures due on Friday will influence the world market itself. China’s retail sales and unemployment figures will also be out on Friday.
India’s retail inflation data due on Tuesday will be important for the Indian market. India’s Consumer Price Index (CPI) grew by 7.44% year-on-year in July and is expected to have slowed down in August. India’s wholesale inflation figures are out on Thursday.
The IIP data revealing India’s industrial production data and manufacturing output will be released on Tuesday itself.
Stocks and Sectors
The announcement that the ‘excess’ reserve ratio imposed in connection with the Rs 2000 note ban will be phased out is also positive for banking stocks. Bank Nifty, which crossed 45000 points once more, is expecting further progress.
The Nifty IT is expected to continue its advance following crossing 32000 points to its best rate in the last 12 months. Although Nasdaq may have influence, positive factors including G20 may also give Indian IT a breakout.
Nvidia’s tie-up with Reliance and Tata Communications for the development of artificial intelligence sector in India is positive for both stocks.
The announcement of Reliance’s entry into the semiconductor sector may cause a stir in the Indian market in the next week as well. Reliance has already started the movement on Friday following revising its capital investment announcements at the annual general meeting.
The announcement of a massive rail project from India to the Middle East sent railway stocks soaring on Friday.
Railway stocks have made good gains in the past week, supported by major development announcements by the railways. RVN, IRCON, RITES and IRFC shares are still eligible for investment.
A US Navy warship maintenance agreement with Mazagon Dock gave the stock a major boost. Break-out Cochin Shipyard and Garden Reach Shipbuilders made good progress.
Indian defense stocks also expect more overseas opportunities under the auspices of the G20 summit.
Garden Reich Shipbuilders is looking for warship orders from India’s friendly countries, which is positive for the stock.
The Indian power sector continues to thrive. The movement spearheaded by Tata Power and PFC is moving to the next level.
Availability of Saudi Aramco’s huge order favors L&T. Expecting orders from the G20, L&T’s huge order book is likely to give the stock a big boost.
India Liquor shares benefit from duty-free support in G-20 countries. All the Indian Liquor stocks gained in the last week.
The imminent merger of IDFC into IDFC First Bank may put pressure on IDFC First.
Advance profitability for supply of radio access network equipment for BSNL favors Tejas Network. Stock gains.
Vedanta Resources to meet with investors once more next week is critical for Vedanta stock. Let’s consider the stock in the next correction.
IPO
Water treatment company EMS Ltd’s IPO starts tomorrow. The IPO price is Rs 200-211 per share with a face value of Rs 10. Can be considered for stock investment.
The IPO of electrical products maker RR Kabel started on Wednesday, September 13 and will end on September 16. The IPO price is Rs 983-1035 per share of Rs 5 face value.
Goldman Sachs-backed Samhi Hotels’ QIP is also taking place next week.
Crude oil
Crude oil gained for a second week in a row amid threats of Saudi production curbs. Brent crude oil closed above $90 on Friday.
gold
Gold corrected once more as the US dollar hit a six-month high as fears of a Fed rate hike resurfaced. The international gold price closed at 1940 dollars. Next week’s US inflation numbers and the upcoming Fed decision will also be critical for gold.
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