For the weekend 27th Aug'21-Friday... Updated on 22.08.21, Sunday-6.56 pm

Last week Nifty trend: Nifty Index last week, opened on a flat to negative note at 16518.40; on Wednesday, it made a high 16701.85, thereafter it moved down on the same day and continued the sell-off till 16376.05 on Fridayll 16162.55 on Friday and closed the week at 16450.50 on a negative note with a weekly loss -78.60 points i.e., -0.48%. 

Sector wise performance: Last week, almost all the major sectoral indices closed on the negative side, except the Nifty IT index. On the negative side, the Nifty Metal index was leading with a weekly loss by -7.99%, followed by the Nifty Realty lost -5.36%, Nifty FMCG lost  -3.38%, Nifty Bank lost -3.14%, Nifty Auto lost -2.69%, Nifty Pharma lost -2.41%, Nifty Energy lost -1.67%, finally the Nifty Financial Services lost -1.14%, on the other hand, the Nifty IT gained 2.06%. Likewise, Nifty Midcap Index closed on a negative note with a weekly loss  -1.72%; as well as, the Nifty Smallcap Index also, closed with a weekly loss -3.42%. 

Institutional Investors trading data: The Foreign Institutional Investors-FII's last week, turned as a net seller in the Equity segment, this week they sold to the tune of Rs.4314.40 crore on the net basis; as well as, the Domestic Institutional Investors-DII's, continued as a net buyer, they bought marginally to the tune of Rs.162.45 crore on the net basis, as per the data forwarded to the SEBI, we must watch the FIIs/FPIs behaviour this week, whether they continue the funds outflow or not.

USD Vs INR: The USD Vs INR opened near $74.22, made a weekly low at $74.09 on Monday; thereafter, it moved up and made a weekly high $74.48 on Friday and closed the week with a positive note at $74.30, This week, the USD Vs INR should move above $74.36-74.48 if moves and sustain above $74.48 then, the USD may re-test $74.58-74.69-74.74-74-80-74.87-74.97-75.09 levels. On the other hand, if the USD moves below $74.23-74.08 then, it may re-visit $74.04-73.98-73.92-73.82-73.75 in the near term. 

Key Events: No major key events are expected this week on the global front; as well as on the domestic front, except the remaining India Inc. Q1(Apr-Jun'21) corporate results and Covid third wave developments, we must watch this week. 

Q1-2021-2022 Earnings: The India Inc. Q1(Apr-Jun'21) corporate results, so far 3614 out of 4248 companies were declared their Q1 results, on a QoQ basis the Net profit seen a drop and continued in the negative zone by -15.80% when compared with last quarter i.e, the Net Profit of these 3614 companies were at Rs.204,070.60 crore, as against in the Q4 (Jan-Mar'21) the Net profit seen Rs.171,916.20 crore. On the other hand, on a YoY basis, the Net profit seen positive growth about 420.70%, last year these 3614 companies made a Net profit Rs.33,016.30 crore. Till last week, almost all major corporate companies declared their Q1(2021-2022) results, this week the rest of the midcap/small cap sector companies will declare their Q1 numbers.

Covid19: The Covid-19 second wave has continuously been witnessed declining trend, as of today the country witnessed everyday covid positive below 35k mark, the number of active cases now at 353,398 the death toll rose to 434,367 the daily death rate moved down below 400 in a day. We will have to wait and see the further developments, the lockdown relaxation already started, if the daily positive numbers are down steadily, may be from this month, the normalcy may return, subject to the vaccination drive happens in a full swing (as on date, the vaccination status stands at 58.15 crore) and the third wave of the covid19.  

Crude Oil: Crude Oil price has come down from $67.80 to $61.80 per barrel and hovering around $62-63, the domestic Petrol & Diesel prices continued to sell above Rs.100-102 mark without any major changes in the last 35 days, though the International Crude price has come down to $62, but the USD Vs.INR is hovering at $74, hence, the oil marketing companies not reduced the petrol price and they reduced the Diesel price marginally last week.

Price Earnings: The price valuation i.e, Price Earnings ratio-PE, has come down from the last week level i.e., 26.51 times and  settled on Friday at 25.21 times. The lower PE valuation around 25-26 times, is due to the Nifty50 stocks Q4 good numbers when compared with last year at the same quarter.  

Advance & Decline (ADR) Ratio & Average Daily Volume(ADV): Market breadth, in the overall NSE listed stocks, last week seen in a negative zone, out of 2072 stocks were traded daily on an average basis, 2418 stocks were advanced and 5640 stocks were declined, the ADR maintained 0.43 times. At the same time, in Nifty50 stocks, the ADR has also gone into the negative zone at 0.60 times with 75 advances and 124 declines, this data infers that, the profit booking seen in the Nifty50, as well as, NSE listed stocks.

F&O Cues & PCR (Put/Call Ratio): The Nifty future was settled at a discount by -16.80 points from the last week premium level -11.75 points, the Nifty Futures Open Interest-OI as of Friday at 10878250 i.e.,217565 lots, when compared with the last week level 13647700 i.e., 272954 lots. The PCR(Put/Call Ratio) has gone up from 0.87 to 0.94, the maximum open interest seen in 16300 PUT option and 16500-16600 CALL, it indicates this week, the Nifty may take support 16300 levels and 16500-16600 levels may act as a strong resistance.

This week Nifty Trend:  Nifty Index as written last week, it peaked till 16700, made  a fresh all time high 16701.85 and  witnessed a minor technical price correction on Fridaty till 16375 and closed at 16450 levels. By considering the above mentioned micro, macro data and other factors, I conclude the weekly outlook that, the Nifty Index on Monday may open on the positive note to test 16500-16540 if, moves above 16540 then, it may try to re-test till 16600-16650-16700 levels, further up move above 16700-16710, may take the index till 16790-16865 in the near term. On the other hand, any weakness at 16500-16600 levels, may drag the Index once again to 16410-16375 levels further weakness below 16375 then, it may re-visit 16340-16290-16225-16165 levels very soon. It looks the index may trade between 16700-15965 levels for some more weeks, trade with due caution at the higher levels.  

Trading Strategy: The Investor/trader those who booked the profit at 16700 levels, re-invest in partial at 16400-16350 levels in the Nifty50 stocks with a short term perspective to gain a profit 5-15%.

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Wishing you for a safe and secured with profitable trading