Weekly Market Outlook

Indian equity benchmarks ended the last week of Samvat 2079 on an optimistic note as traders overlooked concerns over interest rate hikes persisted after Fed Chair Jerome Powell’s hawkish comment, while the Israel-Hamas continues.

Key gauges started the week on a positive note as sentiments got a boost with a survey by prominent economic think-tank NCAER showing an all-around improvement in business sentiments in the second quarter of the current fiscal.

The Business Confidence Index (BCI) rose from 128 in the first quarter of the current fiscal to 140.7 in the second.

Some support also came from the Reserve Bank of India’s (RBI) statement that India’s foreign exchange reserves increased by $2.579 billion to $586.111 billion in the week ended on October 27. In the previous reporting week, the overall reserves had dropped by $2.363 billion to $583.532 billion.

However, market participants turned cautious with a private report stating that a sustained oil price of $110 a barrel could undermine India’s economic stability, likely forcing the central bank to resume hiking interest rates.

It said as the world’s third-biggest consumer of oil, India is one of the most exposed economies in Asia to rising crude prices. A $10 increase in oil prices boosts inflation by 50 basis points and contributes to a 30 basis-point widening in the current account balance.

Sentiments remain dampened amid a private report stating that India’s industrial growth likely cooled to 7.5 per cent in September on account of some weakening of momentum in activity. According to a report, industrial growth – as per the Index of Industrial Production (IIP) – likely fell in September for the first time in three months, with high-frequency data indicative of a slowdown.

However, losses remain capped as traders found some solace with credit rating agency Fitch ratings report stating that the Indian economy has the potential to clock a 6.2 per cent annual average growth rate in the medium term during the 2019-27 period.

Meanwhile, Crisil Ratings stated that the ongoing conflict in the Middle East, confined mainly to the Gaza region now, has caused only negligible disruption in India’s trade so far, and added that the Indian companies were not in the crosshairs for now.

Also, Moody’s Investors Service retained India’s economic growth forecast for 2023 at 6.7 per cent and said strong domestic demand will likely sustain the growth in the near term. Although, buying on the final day of the week helped markets to end above their crucial 64,900 (Sensex) and 19,400 (Nifty) levels.

BSE movement for the week

The Bombay Stock Exchange (BSE) Sensex increased 540.90 points or 0.84% to 64,904.68 during the week ended November 10, 2023.

The BSE Midcap index gained 830.27 points or 2.62% to 32,566.13 and the small-cap index surged 789.7 points or 2.10% to 38,378.76.

On the sectoral front, S&P BSE Healthcare was up by 1,143.26 points or 4.12% to 28,902.84, S&P BSE Capital Goods was up by 1,485.01 points or 3.21% to 47,710.70, S&P BSE Metal was up by 693.29 points or 3.10% to 23,054.29, S&P BSE PSU was up by 334.37 points or 2.68% to 12,826.79 and S&P BSE Realty was up by 136.08 points or 2.67% to 5,240.55 were the top gainers.

S&P BSE Consumer Durables was down by 307.07 points or 0.68% to 45,020.16, S&P BSE TECK was down by 79.79 points or 0.57% to 14,028.96 and S&P BSE Information Technology was down by 73.04 points or 0.23% to 31,248.67 were the few losers on the BSE.

NSE movement for the week

The Nifty increased 194.75 points or 1.01% to 19,425.35.

On the National Stock Exchange (NSE), Bank Nifty increased by 501.85 points or 1.16% to 43,820.10, Nifty Mid Cap 100 increased by 1145.65 points or 2.89% to 40,733.05 and Nifty Next 50 increased by 839.20 points or 1.87% to 45,724.20.

Nifty IT was down by 140.90 points or 0.46% to 30,639.05.

FII transactions during the week

Foreign Institutional Investors (FIIs) were net sellers in the equity segment in the week, with gross purchases of Rs 38,811.00 crore and gross sales of Rs 41,204.47 crore, leading to a net outflow of Rs 2,393.47 crore.

They also stood as net buyers in the debt segment with gross purchases of Rs 14,429.99 crore against gross sales of Rs 10,361.13 crore, resulting in a net inflow of Rs 4,068.86 crore.

In the hybrid segment, FIIs stood as net sellers, with gross purchases of Rs 45.33 crore and gross sales of Rs 55.23 crore, leading to a net outflow of Rs 9.90 crore.

Outlook for the coming week

On the economic front, market participants would be eyeing the data of the Consumer Price Index (CPI), which is scheduled to be released on November 13.

Investors will also be awaiting wholesale price index (WPI) data on November 14, Balance of Trade data to be out on November 15 and Deposit and Bank Loan growth data on November 17.

Traders continue to keep an eye on the financial results of the companies. Some of the companies to release their quarterly numbers next week are Grasim Industries, Jindal Poly Films, NMDC etc.

On the global front, investors will be eyeing macro-economic reports from the world’s largest economy, the United States, starting with Consumer Inflation Expectations on November 13, Consumer Price Index, Redbook on November 14, Producer Price Index (PPI), NY Empire State Manufacturing Index on November 15.

Export Prices, Import Prices, Initial Jobless Claims, Philadelphia Fed Manufacturing Index, Industrial Production, Manufacturing Production on November 16, Building Permits Prel, Baker Hughes Oil Rig Count on November 17.




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