This Week in a nutshell (20th Sept to 24th Sept)

Technical talks

NIFTY opened the week on 20th September at 17,444 and closed on 24th September at 17,853. During the week, the index gaining 2.3% and touched a record high of 17,948 during the market hours on 24th September. Nifty is trading at an RSI of 78, with support at 10 DMA of 17565 and resistance at 18,095.

Weekly highlights

• Evergrande, China’s second-biggest property developer, has US$83.5 million in dollar-bond interest payments due on a US$2 billion offshore bond and a US$47.5 million dollar-bond interest payment due next week. Both bonds would default if Evergrande fails to settle the interest within 30 days of the scheduled payment dates. Chinese authorities are asking local governments to prepare for the potential downfall of the debt-ridden China Evergrande Group.
• Federal Reserve Chairman Jerome Powell said the U.S. central bank could begin scaling back asset purchases in November 2021 and complete the process by mid-2022, after officials revealed a growing inclination to raise interest rates next year.
• The Organisation for Economic Co-operation and Development (OECD) has marginally lowered India’s growth projection for the ongoing fiscal to 9.7%, a reduction of 20 basis points (bps), and to 7.9% for the next financial year, down 30 bps from its May-21 forecast, citing pandemic risks.
• India is planning to set up around 14 gigawatt-hour (GWh) grid-scale battery storage system at the world’s largest renewable energy park at Khavda in Gujarat. This is in addition to a plan to invite bids for the largest global tender for setting up a 13GWh grid-scale battery storage system in Ladakh.
• On 22nd Sept, the Tamil Nadu government signed a Memorandum of Understanding (MoU) for 24 projects worth ₹ 21.2 bn. M K Stalin, chief minister of Tamil Nadu said the government’s goal is to increase the state’s exports to USD 100 bn by 2030.
• Tata and Airbus have signed a Rs 220 bn deal for the production of 56 C-295 transport aircraft for the air force. Under the deal, 40 of the 56 planes will be manufactured in India by a consortium of the Airbus Defence and Space and Tata Advanced Systems Limited (TASL) within 10 years of signing the contract, officials said.
• India is considering an overhaul of its electricity transmission planning to give power companies nationwide unconditional access to the network. The government also proposes to allow states to trade their excess transmission capacities with other states, a senior government official said.
• The foreign institutional investors (FII) net sold equities worth Rs 84 mn, while domestic institutional investors (DIIs) bought equities worth Rs 30,483 mn.

Things to watch out for next week

• The stock markets around the globe may remain volatile next week as the investors remain worried that Evergrande’s downfall could affect the creditors such as banks in China and abroad.
• News of the US Federal Reserve starting to withdraw the monetary stimulus by Nov ’21 and a start of rising interest rates could prove to be negative factors for the markets as it will increase the cost of borrowing for the corporates.

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