The Indian market witnessed a lacklustre week ahead of Muhurat Trading on Diwali as indices fell over 0.5 percent each.
The S&P BSE Sensex closed with losses of 0.6 percent while the Nifty fell 0.7 percent for the week ended October 25.
A mixed performance was seen from the broader market space. The S&P BSE Small-cap index rose 0.2 percent while the Midcap index fell 0.5 percent for the week ended October 25, but there was plenty of action in individual stocks.
As many as 21 stocks in the S&P BSE index fell 10-35 percent. These include names such as Vodafone Idea, Dish TV, Indiabulls Housing Finance, Infosys, InterGlobe Aviation, Orient Cement, SpiceJet, RBL Bank, and Hexaware Technologies, among others.
There were no fireworks on D-Street in the run-up to Diwali this time around thanks to both local as well as global factors.
Uncertainty around Brexit, no clear indications of a definite trade deal between the US and China, selling by foreign and domestic investors, the Supreme Court decision on telcos, subdued earnings, and whistleblower complaints hitting Infosys were contributing factors.
"It was a holiday-shortened week and a whistleblower complaint against Nifty heavyweight - Infosys’ current management triggered some sell-off on the first day itself," Ajit Mishra, VP Research, Religare Broking told Moneycontrol.
"Cues remained subdued thereafter as earnings announcements failed to trigger any major move in the index and indications were mixed from the global front too. In short, markets were largely in the consolidation mood after the recent surge and thus failed to see any major action in the passing week," Mishra added.
The market remained volatile for the week. Technically, the index faced resistance around 11,700 levels while it got support near 11,500-11,550 levels.
The Q2FY20 result announcements showed hits and misses but the expectation for earnings improvement from the next quarter based on tax cuts held investor’s nerves steady, suggest experts.
The coming week will also be a holiday-shortened week and plenty of cues will dictate market trend.
Apart from second-quarter earnings, the market would also react to auto sales numbers, as well as F&O expiry on October 31. On the global front, investors will keep a close eye on the outcome from the US Fed meeting.
"In a holiday-shortened week, investors will stay focused on the next leg of corporate earnings announcements. Auto companies to be in focus as the sector will report a picture of how festive demand has fared in the month of October," Vinod Nair, Head of Research at Geojit Financial Services told Moneycontrol.
"The US Fed is expected to keep its interest rates steady when they meet based on the macro numbers. Volatility is expected to prevail for short term with the overall market volumes showing a decreasing trend as further cues on Brexit and trade war will remain in focus," he said.
Technical Outlook:
The Nifty formed a bearish candle on the daily as well as weekly charts but is trading above the crucial short term moving averages which is a positive sign for the bulls.
The level of 11,700 will continue to act as a crucial resistance level for the index in the coming week, while the supports are placed at 11,400-11,500 levels, suggest experts.
"The Nifty is trading higher above all popular moving averages (20/ 50/100/200) DMA indicating a strong bullish bias to continue further. Since the majority of the oscillators are in the overbought zone, the possibility of price retracement towards a breakout point placed around 11,400 cannot be ruled out," Shabbir Kayyumi, Head of Technical Research at Narnolia Financial Advisors told Moneycontrol.
"On the upside, crucial resistance is around 11,730 and then at the previous swing high around 11,950. The market appears ranged between 11,400-11,700 zones though if volatility tapers then higher possibility of a break above the range will appear," Kayyumi added.
Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are his own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
