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16 September 2016
I had
mentioned in last weeks closing report that the Nifty and Sensex were highly
overbought. On Monday, the major indices of the Indian stock markets suffered a
sharp correction to close more than 1.5% lower than last weeks close. Post the
market holiday on Tuesday, the bulls struggled to take full control. Despite
being in the black over three consecutive days, the indices were not able to
recover from Monday’s losses. The Nifty ended the week 0.98% lower at 8,779 as
compared to 8,866 as on last Friday’s close. The trends of the major indices in
the course of the weeks trading are given in the table below: The Total Investment
& Insurance Solutions
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Weekly Market Report (The
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On Monday, the increased possibility
of a US rate hike and a rout in Asian and European equities dragged the Indian
markets down, as heavy selling pressure was witnessed in automobile, banking
and capital goods stocks. The BSE market breadth was skewed in favour of the
bears -- with 2,033 declines and 688 advances. On the NSE, on Monday there were
186 advances, 1,251 declines and 53 unchanged. Data on the consumer price index
released on Monday by the Central Statistics Office showed that the annual
retail inflation eased by 100 basis points to 5.05% in August. With inflation
easing, there is reduced pressure on aggregate demand and corporate
earnings. The
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India's direct tax collection was up
by 15.03% to Rs1.89 lakh crore while the indirect tax collection jumped by
27.5% to Rs3.36 lakh crore during the April to August period this year, an
official statement said on Monday. On indirect tax collection, the Finance
Ministry statement said, "The figures for indirect tax collections
(central excise, service tax and customs) up to August 2016 show that net
revenue collections are at Rs3.36 lakh crore which is 27.5% more than the net
collections for the corresponding period last year." The collection up to
August 2016 indicates that 43.2% of the annual budget target of indirect taxes
has been achieved, it said. The exchanges were closed on Tuesday on account of
Eid.
On Wednesday, Indian equities market
traded flat during the mid-afternoon trade session. Negative global cues,
coupled with slide in factory output data for July and profit booking dented
investors' sentiments. However, the BSE market breadth was tilted in favour of
the bulls -- with 1,764 advances and 947 declines and 198 unchanged. On the
NSE, on Monday, there were 1006 advances, 458 declines and 57 unchanged.
India's annual rate of inflation based on wholesale prices moved up to 3.74% in
August, from 3.55% in the month before, as per data released on
Wednesday. The
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On Thursday, both the key indices
closed on a flat-to-positive note after a volatile trading session. The benchmark
indices opened in the green, despite negative global cues. The Nifty edged up
by 15.95 points or 0.18% to 8,742.55 points. The Sensex closed at 28,412.89
points -- up 40.66 points or 0.14%. The BSE market breadth was slightly tilted
in favour of the bulls -- with 1,466 advances and 1,271 declines. Investors
were cautious ahead of Bank of England's (BoE) monetary policy review. Besides,
increased possibility of a US rate hike kept the global and local markets
subdued. The US Fed's FOMC (Federal Open Market Committee) will meet on
September 20-21. A hike in US interest rates can potentially lead FPIs (Foreign
Portfolio Investors) away from emerging markets such as India. It is also
expected to dent business margins as access to capital from the US will become
expensive.
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On Friday, the benchmark indices
opened in the black and managed to stay above water throughout the day’s trade.
The benchmark indices opened in the green on the back of positive Asian
markets. Though the bears tried to pull the indices lower post noon, the bulls
remained in control. The Nifty closed at 8,779.85 with a gain of 0.43%, while
the Sensex closed the week at 28,599.03. up 0.66% over Thursday’s close. The
BSE market breadth was marginally tilted in favour of the bears -- with 1,418
declines and 1,275 advances. Good macro-economic data on foreign trade and
positive Asian markets aided in the initial rally. However, a correction in the
key European indices and the upcoming rate-setting meeting of the US Fed,
capped gains.The
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