Nifty, on Friday, closed at 9,837 in a highly volatile market condition. Going forward, this volatility is likely to continue due to various reasons including growing doubts about the US President Donald Trump’s ability to fulfil his economic agenda
US President Donald Trump boards Air Force One as he travels for meetings at Camp David in Maryland. Pic/AFP
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Nifty, on Friday, closed at 9,837 in a highly volatile market condition. Going forward, this volatility is likely to continue due to various reasons including growing doubts about the US President Donald Trump’s ability to fulfil his economic agenda and domestic market conditions. Nifty is likely to get support at 9,747 and 9,646. If these two levels are not taken off then we can expect a minor bounce back of Nifty towards 9,900 to the 9,958 level. A decisive move above this level, can further elevate the market towards the 10,000 mark, but chances are remote. Investors should select good quality stocks for long term investment, which can be accumulated in a phased manner at every decline.
Banking Nifty the usual market supporter is likely to remain under pressure due to PSU banks Non Performing Assets. According to RBI, these banks should recapitalise at the earliest. Bank Nifty has support at 23,871 and 23,617. The lone resistance will be at 24,475.
Tense times
We can expect sideways trends during the week rather than one sided movements, despite easing tensions between North Korea, US, China and India. The declining VIX, both India VIX and US VIX suggest marginal uptrend to the markets. Metal counters are likely to witness limited upside. Nifty metal index has support at 3,294 and resistance at 3,435. Like Metal Index FMCG sector will also show some amount of consolidation and minor uptrend, FMCG index is likely to test 26,000 and the index has support at 24,807. Nifty IT Index and Nifty Energy Index will give support to the Nifty at least in the first days of the week. Pharma stocks will remain subdued in the early days of the week, but later, it can give firm support because the pharma stocks are already entered in the over sold region.
Data view
Marco data like US Markit Composite PMI, Markit Service PMI, Continuing jobless claim, initial jobless claims are due next week. Foreign Exchange Reserve data from India is also due next week. From the European side Balance of trade, Industrial Production, ECB Draghi Speech, GDP Growth Rate, Consumer Confidence and Industrial Production will come out in the coming days. Vardhaman, GATI, Pricol LTD, Castrol, RBL, GILLETTEE, Atlas Cycle, La Opala etc will come out with their quarterly earning numbers.
Stable scene
Crude recovered from the lower levels after OPEC decision to cut output to keep the crude price stable. There are unconfirmed reports of a shutdown of one of the major oil refineries in the US. Further, the weekly count of oil rigs operating in US last week declined and kept the crude price firmer. Crude has support at $46.54 per barrel and resistance at $48.74 and $ 50.69 per barrel.
Gold tested a nine-month high price last week. We can expect consolidation despite a weak dollar this week. Gold has support at $1,275 per troy ounce and resistance at $1,300 and $1,305 per troy ounce.
Alex K Mathews is the founder of www.thedailybrunch.com
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