This Week in a nutshell (Aug 9 th to Aug 13 th )

Technical talks

NIFTY opened the week on 9^th Aug at 16,223 and closed on 13^th Aug at 16,529. This is the highest closing ever for the index. The index made a weekly gain of 1.8%. On the upside, the index might be headed to 17,110. The 16,590 and 16,700 levels will act as potential resistance points, while supports will come in at 16,300 and 16,210.

Weekly highlights

• The market was volatile at the start of the week due to weak global cues however, the bulls managed to push the benchmark indices well in the green.
• BSE announcing the rule regarding Add-on Price Band Framework caused selling pressures in mid and small cap stocks which were down 1% and 2% respectively this week.
• The country’s exports rose by 50.5 percent during August 1-7, on account of healthy growth in the shipments of engineering goods, gems and jewellery as well as petroleum products, according to provisional commerce ministry data. Imports during the week too grew by about 70 percent, leaving a trade deficit of USD 3 bn.
• Consumer Price Index-Based inflation (CPI) for July came in at 5.59 percent, back within the Monetary Policy Committee’s inflation targeting range of 4 (+/-2) percent, on the back of softening food prices. The Consumer Food Price Inflation (CFPI) for July cooled to 3.96 percent compared with 5.15 percent in June.
• Finance Minister Nirmala Sitharaman said that the government is committed to the revival of the economy and will continue to undertake various steps to boost growth.
• The market closed with Nifty posting a net gain of 291 points (1.8%), on a weekly basis mainly contributed by IT sector which is up 4.4% this week. Whereas, Pharma, PSU Banks and Auto sector underperformed.
• US markets were weak at the beginning as a tumble in oil prices signalled investor unease about the Covid-19 pandemic and the strength of the economic recovery. However, the rising US Treasury bills uplifted the sentiments of the investors.
• Fed at the start of the week said that the U.S. economy is growing rapidly and that while the labor market still has room for improvement, inflation is already at a level that could satisfy one leg of a key test for the beginning of interest rate hikes.
• USD 1 tn infrastructure bill was passed during the week which could provide the nation’s biggest investment in decades in roads, bridges, airports and waterways.
• The US markets closed at all time high as investors warmed to jobs data showing a steady U.S. economic recovery.
• According to economists polled by Reuters, Fed will announce a plan to taper its asset purchases in Sept-21 and the U.S. jobless rate would remain above its pre-pandemic level for at least a year.
• Oil prices fell for a second day on Friday after the International Energy Agency warned that demand growth for crude and its products had slowed sharply as surging cases of COVID-19 worldwide has forced governments to revive restrictions on movement.
• The foreign institutional investors (FII) bought Rs 8,790 mn worth of Indian equity shares last week. Domestic institutional investors (DII) undertook Rs 6,370 mn of net buying during this week.

Things to watch out for next week

• The monthly U.S. retail sales report and earnings from retailers such as Walmart and Target could shed more light on the health of the U.S. consumer. Investors are also keeping a close eye on Treasury yields, with rising yields often viewed as a sign of economic optimism that could also boost value stocks.
• Indian Markets – With 1QFY22 result season almost over, focus will be on the global cues, vaccination progress in India, IPO listings and FII buying that will steer market next week.

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