All eyes are on 2019 Lok Sabha election results which will be out on May 23
Benchmark indices recovered from their lows and ended 1 percent higher for the week that ended on May 17 ahead of exit polls for the Lok Sabha election 2019.
The Sensex managed to re-test the 38,000 mark, while Nifty closed above 11,400.
The Sensex ended 1.24 percent higher at 37,930.77, while Nifty ended at 11,407.2, up 1.13 percent in the last week.
On a weekly basis, the rupee shed 31 paise at 70.22 on May 17 against the May 10 closing of 69.91.
The S&P BSE Midcap index shed 0.57 percent, the Smallcap Index fell 1.55 percent, while the S&P BSE Largecap Index was up 0.84 percent in the week gone by.
As many as 658 companies will be declaring their March quarter results in the coming week from May 20 to May 25.
The major earnings include BPCL, HPCL, Tata Motors, DLF, Bharat Forge, Tech Mahindra, Ashoka Buildcon, Bajaj Hindusthan Sugar, Torrent Pharmaceuticals, Indusind Bank, Moil, Sintex Industries, Rolta India, Unichem Laboratories, Atul Auto, NIIT, Sun TV Network, Bata India, Ashok Leyland, Dish TV India, Religare Enterprises, GIC Housing Finance, IDFC, Indraprastha Gas, NCC, NDTV among others.
Tata Motors Q4:
Motilal Oswal is of the view that consolidated revenues are estimated to decline 1.6 percent YoY (up 16.6 percent QoQ), with its EBITDA margin contracting 180 bps YoY to 10.1 percent. The research firm expects JLR’s (including JV) volume to decline by 11.6 percent YoY (up 14 percent QoQ), impacted by slow demand and the deferment of purchases in China.
Motilal Oswal expects adjusted PAT to be at Rs 440 crore.
Voters in 543 Lok Sabha constituencies have already sealed the fate of their leaders. The final phase voting has been held on May 19.
Now, all eyes are on election results which will be out on May 23, Thursday. However, the way markets bounced back on May 17 with huge gains suggest that D-Street is factoring in a positive outcome or at least a stable government at the center.
On May 17, Nifty formed a Big Bullish Candle with a reversal of Harami formation on daily scale as sustained buying interest was seen throughout the session. Now it has to hold above 11,350 zones to extend its gains towards 11500 then 11,550 zones while on the downside supports are seen at 11,250 then 11,180 zones, said Chandan Taparia, derivative & technical analyst at Motilal Oswal Securities.
Bank Nifty formed a Bullish Candle on daily scale as it surpassed its crucial hurdle of 29,250 zones. Now till it holds above 29,250 zones it could extend its move towards 29,850 then 30,000 zones while on the downside supports are seen at 29,000 then 28,888 zones, he added.
India VIX fell down by 1.01 percent at 28.07 levels. However higher VIX suggests that volatile swings could continue in the market ahead of polls and outcome, said Chandan Taparia, derivative & technical analyst at Motilal Oswal Securities.
On the options front maximum Put OI is at 11,000 followed by 11500 strike while maximum Call OI is at 12,000 followed by 12,500 strike. Call writing is seen at 11,800 followed by 11,400 strike while Put writing is seen at 11,000 strike. Option band signifies a wider trading range in between 11,000 to 11,550 zones, he added.
US-China Trade Talk:
China struck a more aggressive tone in its trade war with the United States, suggesting a resumption of talks between the world's two largest economies would be meaningless unless Washington changed its course.
However, President Donald Trump announced a deal to lift US tariffs on steel and aluminum imports from Canada and Mexico. These tariffs had created friction between the neighbours and blocked a new North American free trade agreement.
May 20, 2019: Japan GDP for Q1 2019, Japan Industrial Production for March 2019, Euro Area Current Account for March 2019.
May 21, 2019: Euro Area Consumer Confidence for May 2019, The US Existing Home Sales for April 2019.
May 22, 2019: Japan's Balance of Trade for April 2019, The US MBA Mortgage Application for the week ended May 17, 2019, The US FOMC Minutes, ECB Non Monetary Policy Meeting.
May 23, 2019: Japan Nikkei Flash Manufacturing PMI for May 2019, The US Initial Jobless Claims for May 18, 2019, The US New Home Sales for April 2019, The US Markit Flash PMI for May 2019, Euro Area Markit Flash PMI for May 2019.
May 24, 2019: The US Durables Goods Orders for April 2019, Japan Inflation for April 2019.
May 23, 2019:- India's General Election Results.
May 24, 2019:- India’s Foreign Exchange Reserve for the week ended May 17, 2019.
FII & DII
Foreign institutional investors (FIIs) remained net sellers to the tune of Rs 6,221.35 crore, taking the net total outflow of more than Rs 10,000 crore in May till now.
On the other hand, domestic institutional investors (DIIs) were net buyers of Rs 6,730.35 crore worth of equities in the last week.
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