For the weekend 03rd Sep'21-Friday... Updated on 29.08.21, Sunday-12.39 pm

Last week Nifty trend: Nifty Index last week, opened on a flat to negative note at 16592.25; on the opening the day i.e., Monday, it made a weekly low 16395.70 thereafter, it moved up and surpassed 16700 levels, made a weekly high 16722.05 on Friday and closed the week at 16705.20 on a positive  note with a weekly gain 254.70 points i.e., 1.55%. 

Sector wise performance: Last week, almost all the major sectoral indices closed on a positive note, except the Nifty Auto index. On the positive side, the Nifty FMCG index was leading with a weekly gain by 9.06%, followed by the Nifty Energy gained 3.07%, Nifty Metal gained 2.94%, Nifty IT gained 2.87%, Nifty Financial Services gained 2.14%, Nifty Pharma gained 1.73%, Nifty Bank gained 1.70%, finally Nifty Realty gained 1.03%., on the other hand, the Nifty Auto lost -1.12%. Likewise, Nifty Midcap Index closed on a positive note with a weekly gain 2.14%; as well as, the Nifty Smallcap Index also, closed on a positive note  with a weekly gain 1.92%. 

Institutional Investors trading data: The Foreign Institutional Investors-FII's last week, continued as a net seller in the Equity segment, this week they sold to the tune of Rs.6833.33 crore on the net basis; but, the Domestic Institutional Investors-DII's, continued as a net buyer, they bought to the tune of Rs.6382.57 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 $74.29, made a weekly high $74.30 on the opening move; thereafter, it moved down throughout the week, made a weekly low $73.44 on Friday and closed the week with a negative note at $73.45, This week, the USD Vs INR should take support near $73.39-73.31 if moves and sustain below $73.31 then, the USD may re-visit $73.25-73.20-73.16-73.08-72.98 levels. On the other hand, if the USD moves above $73.44-73.54 then, it may re-test $73.64-73.71-73.77-73.82-73.87-73.95-74.04-74.10 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 3985 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 -14.30% when compared with last quarter i.e, the Net Profit of these 3985 companies were at Rs.172,633.50 crore, as against in the Q4 (Jan-Mar'21) the Net profit seen Rs.201,496.30 crore. On the other hand, on a YoY basis, the Net profit seen positive growth about 415.90%, last year these 3985 companies made a Net profit Rs.33,459.80 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 30k mark, the number of active cases now at 368,558 the death toll rose to 437,830 the daily death rate moved up again above 450 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 September, the Covid infected numbers may rise due to the ensuing festive sessons across the India, the state of Kerala is an example for this, the number of positive cases seen a sudden  jump above 30-35k due to the Onam Festival, they celebrated last to last week. The vaccination drive happens in a full swing (as on date, the vaccination status stands at 63.09 crore).  

Crude Oil: Crude Oil price has gone up once again $61.90 to $69.05 per barrel and hovering around $68-69, the domestic Petrol & Diesel prices continued to sell above Rs.100-102 mark without any major changes, though the International Crude price has come down to $62, but the USD Vs.INR is hovering at $73-74, hence, the oil marketing companies not reduced the petrol price and they reduced the Diesel price further, last week.

Price Earnings: The price valuation i.e, Price Earnings ratio-PE, has gone up from the last week level i.e., 25.21 times and  settled on Friday at 25.60 times. The lower PE valuation around 25-26 times, is due to the changes have been made in the PE calculation i.e., from an existing pattern of standalone profit to the consolidated profit and 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 positive zone, out of 2078 stocks were traded daily on an average basis, 5428 stocks were advanced and 4595 stocks were declined, the ADR maintained 1.18 times; as well as, the Nifty50 stocks ADR also has moved to the positive zone at 1.28 times with 139 advances and 109 declines, this data infers that, the buying interest seen in the Nifty50, as well as, NSE listed stocks.

F&O Cues & PCR (Put/Call Ratio): The Nifty future was settled at a premium by 12.95 points from the last week discount level -16.80 points, the Nifty Futures Open Interest-OI as of Friday at 1348250 i.e.,268365 contracts, when compared with the last week level 10878250 i.e., 217565 contracts. The PCR(Put/Call Ratio) has come down from 0.94 to 0.83, the maximum open interest seen in 16900 PUT option and 17000 CALL option, it indicates this week, the Nifty may test 16900-17000 levels and 16600-16500 levels may act as a strong support.

This week Nifty Trend:  Nifty Index as written last week, surpassed once again above 16700, made  a fresh all time high 16722.05 and closed well above 16700 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 a positive note with gapup to test 16765-16790 if, moves above 16790 then, it may try to test till 16825-16865-16900-16965-17000 levels in the near term. On the other hand, any weakness at 16765-16790-16825 levels, may drag the Index once again to 16700-16565 levels further weakness below 16565 then, it may re-visit 16450-16365 levels very soon. It looks the index may see some technical sell-off cum profit booking till 16600-16400 levels, either this week or next week, trade with due caution at the higher levels and adopt the buy on dips strategy.

Trading Strategy: The Investor/trader those who re-invested again 16400 levels, start to book profit near 16700-16900 levels and wait for the further down move to re-invest in the Nifty50 stocks with a short term perspective to gain a profit 5-15%.

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