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Weekly Market Forecast: 6th August to 12th August 2018 The Indians market scaled to a new all-time high, again in the week. The NIFTY closed at 11360.80 (11278.35 last week) up in green by another 0.73%. The bank NIFTY, also reached a new high and closed 27695.50 (27634.40 last week) and strengthened by 0.22%. Both BSE Midcap and Smallcap made gains for the second consecutive week. Midcap Index closed at 16206.89 (15912.62 last week), a gain of 1.85% and BSE Smallcap index closed at 16833.52 (16450.20 last week), a gain of 2.33%.
The bullish trend continues of the broader market on a monthly basis. The market direction will continue to be driven by the first quarter results, as more companies will report their numbers. A caution is advised as the market may react to the increase in interest rate announced by RBI last week in its MPC meet. A watch on Indian macro data and global events is also crucial.
The US bourses were volatile, Dow Jones Industrial Average (DOW) closed flat for the week at 25462.58 (25451.06 last week) up by 0.04%. S&P 500 also closed in green at 2840.35 (2818.82 last week) up by 0.78%. However, NASDAQ ended in red for the week and closed at 7812.02 (7737.42 last week) up by 0.97%.
Both Gold and silver prices continued to trade lower for the fourth week in a row. MCX Gold Mini 05 Sep Futures closed at 29,612 (29,868 last week) down by 86%. MCX Silver Mini 31 Aug Futures closed weaker, too, at 38,111 (38,356 last week) down by 0.64%.
Crude oil ended flat, again for 2nd week. MCX Crude oil 20 Aug Futures closed at 4690 (4686 last week).
The Indian Rupee appreciated marginally for the week. USD/INR closed higher at 68.6200 compared to last week’s close of 68.6550.
Events in the week:
- Tuesday 07 Aug – China data on Forex reserves; US data on Job Openings,
- Wednesday 08 Aug – China data on Exports/ Imports & Trade balance; US data on Crude oil inventories
- Thursday 09 Aug – China data on Inflation, New Loans; US data on Core PPI and PPI
- Friday 10 Aug – India data on Industrial Production, and Manufacturing Output; USD data on Inflation
Trading Ideas: Based on technical analysis, we recommend the following trades for the week:
1. HDFC Bank: Buy @ 2085.30; StopLoss 2060.10; Target 2135.80
2. BPCL: Sell @ 412.40; StopLoss 418.95; Target 392.70
Last week’s Technical Call:
1. Reliance Capital: Buy @ 404.60; StopLoss 398.60; Target 416.60…stoploss triggered
2. India Cements: Buy @ 116.1; StopLoss 114.05; Target 120.20…stoploss triggered
3. Tata Motors: Sell @ 273.25; StopLoss 277.65; Target 260.15…did not reach price level
Weekly Top Gainers/ Losers (NIFTY)
| Top Gainers | Top Losers | |||
| Name of Company | Weekly Return | Name of Company | Weekly Return | |
| Dr. Reddy’s Lab | 9.5% | Eicher Motors | - 6.74% | |
| Lupin | 8.68% | HDFC Bank | - 3.66% | |
| Coal India | 6.52% | Tata Motors | - 3.62% | |
| HUL | 6.27% | HDFC | - 3.41% | |
| Power Grid | 5.73% | Garsim | - 1.88% | |
Credit- Dr Amiya Sahu
Bond market update
Bond yields retreated slightly this week, it moved lower by two basis points (down by 0.22 %) during the week closing at 7.76%.
RBI in its MPC meeting increased interest rates by 25 basis points second time in a row, it also maintained its policy stance to neutral.