For the weekend 11th Sep'20-Friday... Updated on 05.09.20, Saturday : 06.30 pm

Last week Nifty trend: Nifty Index as expected and wriiten last week, opened with positive note beyond our resistance band i.e, 11660-11710, made a open at 11777.55 and made a weekly high at 11794.25 thereafter, the Index witnessed a huge sell-off till our support level 11370, made a low 11325.85 on Monday itself, further the Index bounced till 11584.95 on Thursday, but unable to move above 11600, on Friday once again got sold-off till 11303.65 and closed at 11333.85 with a loss 313.75 points i.e.,-2.69%. As written in the last week outlook, the Index tested and moved beyond our resistance level 11735, unable to sustain above this level and acted as a strong resistance last week. 

This week Nifty Trend: The Nifty index may open on Monday i.e., 07th Sep'20, on a flat to negative note, subject to the Asian market opening move, to test 11330-11290, if open, surpass and sustain below 11290 then, the immediate support lies at 11255-11230-11165-11111-11060-10990-10940-10885 levels. On the other hand, the immediate resistance seen at 11375-11430 any further move above 11430 then, the Index may re-test 11460-11490-11570-11640-11690-11735 levels.

Key Events: This week major key events are expected in the domestic front, the July month Index of Industrial Production-IIP data, which is expected on 11th Sep-Friday, other than that no other major key events are expected in the global front. The India Inc., Q1-June'20 remaining results are also plays an important role in the Nifty index further movement, as of 05th Sep'20, around 2172 out of 4268 companies already, announced their results, the Net profit seen at 12.70% on Quarter on Quarter-QoQ basis and maintain its subdued performance by -57.80% on Year on Year-YoY basis, the QoQ performance has dropped from the last week level i.e., 22.10% to 12.70%, shows that the India Inc., net profit not improved further, the corporates who declared their results last week mostly showed negative performance, hence the trend once again moving southwards, we must wait and watch remaining corporates around 300 or more are expected to announce their results this week. 

Special Mention: As written in the last week outlook, i clearly mentioned that the weekly trading range narrows, convincing volume is not happening, some weakness sign with fatigue movement in the Nifty Index move and Nifty Futures OI-Open Interest moved up at the higher levels, these factors were dragged the Index near 11300, the Banking stocks are major culprits to drag the Index last week. As well as the Nifty premium valuation in terms of Price Earnings-PE touched the all time high beyond 33 times, which was triggered the profit booking on the opening move on Monday, continued even on Friday till 11300.  The imposition of new SEBI margin rule also created an unpleasantness among the traders/invettors, not seen any major participation which was evident in the daily volume except Monday and Friday. By considering the above factors, I expect the Nifty index coming week may try to consolidate with downward bias to trade between 11200-11600, the Put-Call ratio is also suggest this, breaking either of these ranges may push the Nifty Index to test 10990-10880 on the lower side or 11735-11870 on the higher side in the near term.

Sector wise performance: Last week, all the major sectoral Indices lost the momentum  and closed the week with negative bias. Nifty Bank Index lead the loss by -6.17%, Nifty Realty(-5.60%), Nifty Energy(-3.36%), Nifty Pharma(-2.94%) Nifty Metal(-2.73%), Nifty Auto(-1.42%), Nifty FMCG(-1.36%) and Nifty IT marginally lost by -0.27%.

Institutional Investors trading data: The Foreign Institutional Investors-FII's last week turned as net seller and sold to the tune of Rs.2799.89 crores on the net basis whereas, the Domestic Institutional Investors-DII's, continuded as a net selller and sold to the tune of Rs.1088.63 crores on the net basis in the equity segment, the FIIs booked some profit last week, we should wait and watch how they behave coming week, whereas the DIIs also in selling mode. Last week we wrote the FIIs may continue the inflow in to the Indian equity market but, the valuation worry and global indices mild sell-off,  triggered some profit booking in our market also, the USD Vs INR appreciated further till $72.71 on 01st Sep'20 and bounced once again till $73.70 and closed at $73.30 on Friday, further appreciation or depreciation depends on breaking either side i.e,  above $73.79 on higher side and below $72.71 on the lower side.

Tading Strategy: The Investor/trader may use any dip till 11200-10900 zone to buy Nifty50 stocks which have corrected more than 10-15% for the short term perspective to get a short term profit around 5-10%. This is a traders market, to trade for short term gains, rather to wait for long term basis.

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