For the weekend 25th Sep'20-Friday... Updated on 20.09.20, Sunday: 07.53 am

Last week Nifty trend: Nifty Index as expected and written last week, opened with positive note at 11540.15, our expected opening band i.e, 11490-11525, the index made a high at 11568.90 on opening day, but unable to move up further, on the same day the brief sell-off dragged the Index till our support band i.e., 11400-11340, made a weekly low at 11383.55, took major support near that level and moved once again till 11618.90 on Wednesday and closed at 11504.95 with a weekly gain about 40.50 points i.e.,0.35%. As written in the last week outlook, the Index took support at 11400, I was anticipated this, mentioned this trading band, i.e., between 11400-11200, the Nifty Index moved near 11600 and closed on a flat note with positive bias.

This week Nifty Trend: The Nifty index may open on Monday i.e., 21st Sep'20, on a flat to negative note, subject to the Asian market move, to test 11490-11446, if open and sustain below 11446 then, the immediate suppot lies at 11385-11350-11290-11235-11185-11111-11065-10995 levels. On the other hand, the immediate resistance seen at 11530-11585 any further move above 11585 then, the Index may re-test 11620-11685-11735-11795 levels.

Key Events: This week no major key events are expected in the domestic front and from the global front, except F& Expiry on 24th Sep'20. The India Inc., Q1-June'20 remaining results are also plays an important role in the Nifty index further movement till first week of Oct'20, as of 19th Sep'20, around 3573 out of 4268 companies already, announced their results, the Net Income seen a major drop and made a net loss about -25.30% on Quarter on Quarter-QoQ basis and maintain its subdued performance by -77.10% on Year on Year-YoY basis, the QoQ performance has dropped from the last week level i.e., from the Net Profit 10% to Net Loss -25.30%, which infers that, the India Inc., net income taken a major blow, the corporates who declared their results last week showed dismal performance, hence the trend continues the down move towards the southward direction, we must wait and watch for the remaining corporates reults, which are expected to announce by this week. The price valuation, Price Earnings ratio-PE, last week tested the all time high at 33.26 times, most of the days in last week, it was roaming around 33 and dropped to 32.98 on Friday. 

Special Mention: Last week, the SEBI circular on 'Asset Allocation of Multi Cap Funds', the multi cap fund is now required to invest in equities and equity realated instruments with a minimum of 75% from the existing liimit of 65%, I expected this may help the Nifty Index may see some inflow from DIIs but, due to re-balancing the multi-cap fund asset allocation the DIIs were selling mode in large cap stocks, which was evident from the performance of Nifty Midcap-100 Index seen a weekly gain by 3.78% and Nifty Small Cap-100 gained over 6% (6.04%), whereas most of the large cap stcoks were seen a selling pressure. By considering the above factors, I expect the Nifty Index coming week may face the selling pressure to test 11400-11300, any weakness below this levels, may drag the Nifty Index to test 11235-11185-11111-11065-10995 levels. Further, any up move is possible only when the Index surpass above 11585-11620 levels, if the Index trade, sustain above 11620 then, the next level resistance seen at 11685-11735-11795-11870 levels for the near term.

Sector wise performance: Last week, the major sectoral Indices had given good movement, the Nifty Pharma lead the weekly gain by 8.91%, Nifty IT moved up by 6.41%, Nifty Realty moved up 5.49% and Nifty Auto also moved by 2.58% these indices were the major contributors to save the Nifty Index from the selling pressure and able to close the Nifty Index flat to positive note whereas, the Nifty Bank lost -2.00%, Nifty Energy lost -1.04% and Nifty Metal margianlly lost by -0.93%.

Institutional Investors trading data: The Foreign Institutional Investors-FII's last week turned to be a net buyer, they bought to the tune of Rs.1589.10 crores on the net basis whereas, the Domestic Institutional Investors-DII's, continued as a net selller, they sold to the tune of Rs.2396.85 crores on the net basis in the equity segment, as per the data released by NSE in their website, the FIIs stopped the selling button last week, we should wait and watch how they behave in the coming week.

USD Vs INR: The USD Vs INR depreciated from the high level i.e.,$73.79 (please refer the last week outlook, i have mentioed this level i.e., $73.79, as a breakout point) to $73.15 (the support level also mentioed as $73.11), bounced back once again from the low level and closed on Friday at $73.60, further appreciation or depreciation depends on breaking either side i.e., above $73.79 then, it may test $73.96-74.17 on higher side and lower side support seen $73.15-73.11, below $73.11 then, it may re-test $73.01-72.89-72.71.

Tading Strategy: The Investor/trader, those who wants invest, then choose good midcap and small cap stocks with low PE for medium term perspective and good Nifty 50 stocks such as ITC, Bharti Airtel etc,, when the Nifty Index moves to 11400-11200 for a short term gain about 5-10%. This is a traders market, to trade for short term gains, rather to wait for long term basis.

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