Weekly Market Outlook

Due to continuous inflows of foreign capital, Indian equities benchmarks have been trading higher for the fourth week in a row, with frontline indexes closing above the 66,600 (Sensex) and 19,700 (Nifty) levels.

On the final day of the week, Infosys revised its guidance to negative, wiping off most of the weekly gains.

HDFC Bank announced better-than-expected Q1 results, which led to an optimistic start to the week as the banking sector rallied.

IMF’s statement that India has adopted a very aggressive stance toward advancing G20 aims and that its two main priorities during its presidency are strengthening macroeconomic coordination and increasing finance for global public goods provided some additional support.

Data from the National Securities Depository (NSDL) reveals that foreign portfolio investors (FPIs) have been net purchasers in Indian stock markets for the sixth consecutive month, supporting positive sentiments.

In March, April, May, and June, respectively, FPIs purchased Indian stocks for amounts of Rs 7,936 crore, Rs 11,631 crore, Rs 43,838 crore, and Rs 47,148 crore.

BSE movement for the week

During the week ending July 21, 2023, the Bombay Stock Exchange (BSE) Sensex increased 623 points or 0.94% to 66,684.

The BSE Small cap index increased 444 points or 1.32% to 34,146, while the BSE Midcap index rose 154 points or 0.52% to 29,547.

Top gainers on a sectoral level included the S&P BSE BANKEX, which increased by 1,563 points or 3.09% to 52,122, the S&P BSE PSU, which increased by 286 points or 2.60% to 11,274, and the S&P BSE Capital Goods, which increased by 1,055 points or 2.55% to 42,402.

The top three losers on the BSE were S&P BSE Consumer Durables, which fell by 549 points or 1.28% to 42,257, S&P BSE TECK, which fell by 479 points or 3.41% to 13,552 and S&P BSE Information Technology, which fell by 1,197 points or 3.83% to 30,099.

NSE movement for the week

The Nifty surged 181 points or 0.92% to 19,745.

Nifty Mid Cap 100 rose 271 points or 0.74% to 36,800 on the NSE, while Bank Nifty jumped by 1256 points or 2.80% to 46,075.

Nifty IT dropped by 1074 points or 3.47% to 29,871. Nifty Next 50 dropped by 58 points or 0.13% to 44,184.

FII transactions during the week

Foreign Institutional Investors (FIIs) were net buyers in the equity segment in the week, with gross purchases of Rs 55,021 crore and gross sales of Rs 41,877 crore, leading to a net inflow of Rs 13,144 crore.

They also stood as net buyers in the debt segment with gross purchases of Rs 3,343 crore against gross sales of Rs 1,787 crore, resulting in a net inflow of Rs 1,556 crore.

In the hybrid segment, FIIs stood as net sellers, with gross purchases of Rs 37 crore and gross sales of Rs 45 crore, leading to a net outflow of Rs 8 crore.

Outlook for the coming week

On the economic front, investors will be eyeing the data on Government Budget Value and Foreign Exchange Reserves, scheduled to be released on July 28 along with India Deposit Growth, Bank Loan Growth, and Infrastructure output are also scheduled to be released.

In the ongoing earning season, investors would first react to results of Canara Bank, PNB Housing Finance, Tata Steel, TVS Motor Company, Asian Paints, Bajaj Auto, Cyient, Dixon Technologies, Jubilant FoodWorks, Larsen and Toubro, Tata Motors, Axis Bank, Bajaj Finance, Bharat Petroleum Corporation, Cipla, Dr Reddy’s Laboratories, Jindal Stainless, Punjab National Bank etc.

Investors will be watching a few economic reports from the largest economy in the world, the United States (US), commencing on July 24 with the S&P Global Manufacturing PMI, S&P Global Composite PMI, and S&P Global Services PMI.

This will be followed by Redbook, CB Consumer Confidence on July 25, New Home Sales, Fed Interest Rate Decision, and Building Permits on July 26.

Fed Press Conference, Durable Goods Orders, GDP Growth Rate, Goods Trade Balance, Initial Jobless Claims on July 27 and Core PCE Price Index, Personal Spending, Personal Income, Baker Hughes Oil Rig Count on July 28.

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