This Week in a nutshell (28th Nov to 2nd December)

Technical talks

NIFTY opened the week on 28^th November at 18,430 and closed on 2^nd December at 18,696 after making an all-time high of 18,887. The 20WMA of 18,338 may act as a key support level, while 18,885 may act as key resistance for the index.

Among the sectoral indices, Media (+4%), Realty (+4%) and FMCG (+2.4%) were the top gainers while there were no losers in the week.

Weekly highlights

• Auto companies reported their November sales volume during the week. Post-festive season wholesales in the two-wheeler segment witnessed inventory destocking amid strong retail demand while passenger vehicle segment retails were largely in line with wholesales. Additionally, the size of production of high-end two-wheelers continued to suffer from chip shortages, causing wholesale numbers for November 2022 to decline even more month over month for all.
• Though inflation has cooled in India, the central bank is expected to raise interest rates by 35 basis points to 6.25% at its December 5-7 policy meeting. Rate increases are anticipated to be driven by two factors: domestic inflation and US rate hikes to avoid pressure on the rupee.
• Oil experienced its largest weekly increase in a month after a volatile week marked by China lifting covid limitations and speculations over the OPEC+ output strategy. The outlook for energy consumption was aided by the peculation of OPEC+ output cutbacks and the loosening of covid restrictions. Brent crude futures were up 0.4%, at $87.25 per barrel by 1441 GMT. U.S. West Texas Intermediate (WTI) crude futures rose 0.7%, at   $81.77 per barrel.
• A gauge of food prices used by the UN fell 0.1% last month, reaching its lowest level since January. Wheat and corn prices fell after Ukraine’s grain export agreement was renewed, and food demand is being limited by the possibility of a worldwide recession. Rising food costs have been a significant factor in the global inflationary spiral that is causing a cost of living problem in nations from Malaysia to the UK.
• U.S. stocks were down on Friday after a better-than-anticipated November jobs data dampened hopes that the Federal Reserve might slow the rate at which it raises interest rates. After Fed Chair Jerome Powell’s remarks about reducing interest rate hikes as early as December, stocks had risen earlier in the week.
• FII (Foreign Institutional Investors) turned net buyers this week, buying shares worth Rs 1,50,770 mn. The additional 1.15% share in Zomato that Temasek, an investment fund run by the Singaporean government, purchased on November 30 is included in the FII purchases.
• DII (Domestic Institutional Investors) were net sellers, selling shares worth Rs 13,350 mn.

Things to watch out for next week

The market movement will continue to be determined by the flow of global news. The RBI’s credit policy announcement next week and the US Fed rate-setting meeting in mid-December are the two immediate triggers that will decide the sentiment of investors in the near future.

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