For the weekend 17th Sep'21-Friday... Updated on 12.09.21, Sunday-6.03 pm

Last week Nifty trend: Nifty Index last week, opened on a positive note at 17399.35; on Tuesday, it made a weekly high 17436.50 thereafter, it moved down, made a weekly low 17254.20 and closed the week at 17369.25 on a positive note with a weekly gain 45.65 points i.e., 0.26%. 

Sector wise performance: Last week, the major sectoral indices were given mixed performance, on the positive side, the Nifty Energy index was leading with a weekly gain by 1.02%, followed by the Nifty FMCG gained 0.87%, Nifty Metal gained 0.80% and Nifty Financial Services gained marginally by 0.17%. On the other hand, Nifty Pharma was leading with a weekly loss by -1.08%, followed by Nifty IT lost -0.25%, Nifty Bank lost -0.21%, Nifty Auto lost -0.12%, finally Nifty Realty lost marginally by -0.06%. Likewise, Nifty Midcap Index closed on a positive note with a weekly gain 0.97%; as well as, the Nifty Smallcap Index also, closed on a positive note  with a weekly gain 2.31%. 

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.843.88 crore on the net basis; but, the Domestic Institutional Investors-DII's, turned as a net buyer, they bought to the tune of Rs.1115.55 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 $72.99, made a weekly low $72.97 on the opening move; thereafter, it moved up throughout the week, made a weekly high $73.87 on Wednesday and closed the week with a positive note at $73.52. This week, the USD Vs INR should take support near $73.30-73.16, if moves and sustain below $73.16 then, the USD may re-visit $72.98-72.90-72.85-72.74-72.64-72.54-72.40 levels. On the other hand, if the USD moves above $73.57-73.63 then, it may re-test $73.75-73.82-73.93-74.04-74.15-74.25-74.35-74.46 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 India WPI Inflation data and 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 4009 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 -14.10% when compared with last quarter i.e, the Net Profit of these 4009 companies were at Rs.173,317.30 crore, as against in the Q4 (Jan-Mar'21) the Net profit seen Rs.201,729.70 crore. On the other hand, on a YoY basis, the Net profit seen positive growth about 412.40%, last year these 4009 companies made a Net profit Rs.33,824.10 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 30 mark, the number of active cases now at 384,921 the death toll rose to 442,655 the daily death rate has moved down below 350 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 seasons across the India. The vaccination drive happens in a full swing (as on date, the vaccination status stands at 73.82 crore).  

Crude Oil: Crude Oil price has traded in range bound between $67 to $70 per barrel and hovering around $69-70, the domestic Petrol & Diesel prices continued to sell above Rs.100-102 mark without any major changes, though the International Crude price hovering around $69-70, but the USD Vs.INR is hovering at $73-74, hence, the oil marketing companies started to reduce petrol price and Diesel price marginally.

Price Earnings: The price valuation i.e, Price Earnings ratio-PE, has gone up from the last week level i.e., 26.54 times and  settled on Friday at 26.61 times. The lower PE valuation around 25-27 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 negative zone, out of 2091 stocks were traded daily on an average basis, 4879 stocks were advanced and 5083 stocks were declined, the ADR maintained 0.96 times; whereas, the Nifty50 stocks ADR continued in the positive zone at 1.15 times with 133 advances and 116 declines, this data infers that, more buying interest seen in the Nifty50, rather than, NSE listed stocks.

F&O Cues & PCR (Put/Call Ratio): The Nifty future was settled at a discount 4.95 points from the last week premium level 5.75 points, the Nifty Futures Open Interest-OI as of Thursday at 14772750 i.e.,268365 contracts, when compared with the last week level 13418250 i.e., 295455 contracts. The PCR(Put/Call Ratio) has gone up from 0.84 to 0.92, the maximum open interest seen in 17300 PUT option and 17600-17700 CALL option, it indicates this week, the Nifty may move take support near 17300 and face strong hurdle at 17600-17700 levels, further weakness below 17300 may drag the Nifty index till 17200-17100 levels.

This week Nifty Trend: Nifty Index as written last week, took support near 17300-17200 and closed well above 17360 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 flat to positive note to test 17355-17380 if, moves above 17380 then, it may try to test till 17400-17436-17500-17555-17650-17750-17825 levels in the near term. On the other hand, the Index may take support 17300-17255 levels, any weakness below 17255 then, the Index may re-visit 17205-17150-17055-16950-16915-16880-16765 levels very soon. The index technical sell-off may intensify unless it moves above 17400-17450 levels, 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 full profit near 17400-17700 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% when the Nifty Index comes near 17000-16800 levels.

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