The week ahead for Indian share market: Key factors that traders should follow to trade in Nifty50

 

Indian share market, Nifty50 & Sensex closed marginally lower in the last week. The Nifty50 moved around 550 points during the week. The markets opened a huge gap up the next day after Prime Minister Narendra Modi announced a 20 Lakh crores stimulus package. The Indian share market reacted negatively after hearing the details of the package announced by the Finance Minister Nirmala Sitharaman so far.

On the global front, the cues were not positive in the first half of the week. But on Friday the Asian markets reacted positively after China released improved Industrial growth data. On Friday even the US and European markets closed in the green.

 

Nifty50, Sensex and Bank Nifty last week

On a weekly basis, the Nifty50 closed down by 114.65 points or 1.23% while the Sensex declined by 544.97 points or 1.72%. The Nifty Banking index, Bank Nifty was down by 518.95 points or 2.69%.

The Nifty Midcap and Smallcap 100 indexes gained in the last week. The Midcap index gained 203.10 points or 1.60% whereas the Smallcap index was marginally up by 24.5 points or 0.63% in the last week.

 

Nifty share top gainers and losers in the last week

Weekly Nifty50 Gainers
Company Name	LTP	Previous Close	Change (%)
Vedanta	92.95	77.4	20.09
Bharti Infratel	202.5	174.25	16.21
Hero Motor Corp	2193.55	1962.6	11.77
Bajaj Auto	2663.6	2419.05	10.11
Maruti Suzuki	5100.4	4654.16	9.59
Weekly Nifty50 Losers
Company Name	LTP	Previous Close	Change (%)
Nestle	16443.8	17802.95	7.63
Dr. Reddy	3735.1	3984	6.25
GAIL	85.8	91.35	6.8
Reliance Ind	1459.4	1547.13	5.67
IndusInd Bank	418.7	440.35	4.92

Nifty smallcap & midcap gainers and losers

 

Weekly Nifty Midcap 100 Gainers
Company Name	LTP	Previous Close	Change (%)
BHEL	27.30	22.20	22.97
Jubilant Life	472.40	480.60	21.56
Weekly Nifty Midcap 100 Losers
Company Name	LTP	Previous Close	Change (%)
Indiabulls Ventures	87.5	103.85	15.74
Future Consumers	7.95	9.35	14.97
Weekly Nifty Smallcap 100 Gainers
Company Name	LTP	Previous Close	Change (%)
Sobha	209.5	177.5	18.03
Spice Jet	45.6	38.9	17.22
Weekly Nifty Smallcap 100 Losers
Company Name	LTP	Previous Close	Change (%)
Sonata software	185.5	210.25	11.77
Karur Vysya Bank	23.7	26.35	10.06

Top economic and market-related news

The Index of Industrial Production (IIP) contracted by 16.7% in March last year. According to revised data for the previous two months, IIP grew by 2.08% in January 2020 and by 4.62% in February 2020.

India’s retail inflation (CPI) in April eased to 5.84% from 5.91% in March as per the data announced by Ministery of Statistics and Programme Implementation. Whereas the WPI food inflation numbers eased to 3.60% in April from 5.49% in March.

Last week Prime Minister Narendra Modi in his address to the nation announced a 20 lakh crore, stimulus package due to coronavirus outbreak. It is nearly 10% of India’s GDP which the Finance Minister Nirmala Sitharaman is detailing for the last three days in her press conference.

In the last three days, the Finance Minister has detailed how it will be benefited to MSE, NBFC, Farmers, Migrant works, and street vendors. Sunday will be the last day to detail about the package. We will also have the roadmap for Lockdown ver 4 by Sunday.

 

Other news that moved Sensex and Nifty50 share price last week

Public sector banks sanctions loans worth Rs 6 Lakh crores in two months

Indian oil raises refineries production run to 60%

Tata Steel may de-merge the UK, Dutch units

Jubilant life Science inks pact with Gilead to produce, sell Remdesivir

ITc forays into packaged lassi to expand its dairy business

BRICS’ New Development Bank provides$1 billion loans to India to fight COVID-19

Wipro Infrastructure Engineering develops sanitizing walkways

IOC creates an $800 million fund to address the coronavirus crisis.

As per the report, 72% of outstanding bank credit are in the red zone.

Godrej bets big on hygiene products segment, expects it to be new core in the next 2-3 years

Bandhan Bank expects the recovery to start from the second quarter of FY21

Cipla approaches ICMR to make ELISA antibody test kits

NMDC looks to restore full production in a month

Cipla’s board approved Rs 3000 crores fundraising plan

ITC to launches Savlon hand sanitizer sachet at 50 paise

Key factors that the traders should follow to trade in Nifty50 and Bank Nifty next week

Global cues

Traders need to follow the global cues next week. Global news related to macro data, updates about the coronavirus related news, the news related trade war with the US and China should be tracked by the traders next week.

 

Coronavirus & Lockdown extension

The coronavirus cases in India have surpassed Chinas total number of cases now. The cases are increasing and touching a new record high in India. The increasing cases of coronavirus can make heavy pressure on our economic growth. This may extend the lockdown in India which ultimately hamper the economic growth.

India will get guidelines for Lockdown Ver.4 on Sunday 17th May. As per sources, there could be some ease in the rules of opening industries and shops in the Green and Orange zones. This can be good news for the Indian economy and Indian share market, the traders should watch out for the guidelines.

 

Stimulus Package

On the announcement of the Rs 20 Lakh crores, special stimulus package by Prime Minister Narendra Modi last week, the Indian share market made a gap up opening on 13th May. The details of the package are releasing on five tranches by the Finance Minister Nirmala Sitharaman. 

The Indian share market was however overlooked and not reacted to the first two announcements by Finance Minister. The market will have the full stimulus package by 17th May, Sunday and we may see some reaction in the market on Monday. 

Crude Oil Prices

The Brent crude futures an international benchmark of crude oil closed last week at $ 32.84 per barrel. It has touched a weekly high at $32.91 and low at $28.86 per barrel. It looks that the price of crude oil futures has become stable at around $30 per barrel due to production cuts in the US and further in Saudi Arabia.

But the demand for crude oil has not yet increased as most of the countries are in lockdown due to the coronavirus outbreak. Any further fall in crude oil prices could correct the global markets. Traders should track crude oil prices closely. 

 

Technicals of Nifty50 and Bank Nifty trend

Nifty technical analysis in Futures

Primary Trend of Nifty Futures next week: Bearish

Range-Bound Trend of Nifty Futures: 

All up Moves Initiates Profit Booking (Sale) @ 9360 whereas All Down Moves Initiates Short Covering (Buy) @ 8970

If Nifty50 futures share price Moves Above 9155 and sustain. Then you should Buy with 1st Target of 9030 during the week with a Stop Loss of 9090 FOR the Target of 9184- 9280- 9360- 9455

If Nifty50 futures share price Moves Below 9030 and sustain. Then you should Sell with 1st Target of 8970 during the week with a Stop Loss of 9185. FOR the Target of 8970- 8925- 8840- 8732

 

Technical analysis of Bank Nifty share price in Futures

Primary Trend of Bank Nifty future for next week: Bearish

Range-Bound Trend of Bank Nifty Future: 

All up Moves Initiates Profit Booking (Sale) @ 19470, whereas All Down Moves Initiates Short  Covering (Buy) @ 17760

If Bank Nifty share price future Moves Above 18950 and sustain. Then you should Buy with 1st Target of 19140 during the day with a Stop Loss of  18640. FOR the Target of 19140 – 19250- 19470- 19650

If Bank Nifty share price future Moves Below 18640 and sustained. Then you should Sell with 1st Target of 18480 during the day with a Stop Loss of 19640. FOR the Target of 18480 – 18190- 17980-17760

FIIs and DIIs data

The FIIs are the seller and DIIs are buyers in the last week in the cash segment. FIIs sold Rs 5951.15 crores whereas DIIs bought Rs 1074.94 crores in the cash segment last week. If FIIs continue to sell in the cash segment than we may not up move in the Indin share market. Traders need to follow the FIIs data in the coming week to know the market trend.

 

Q4 Earnings

Last week on 13th May Kotak Mahindra Bank has reported Q4 earnings, the bank reported Rs 1267 crores net profit but the Bank has made COVID 19 related provision of Rs 650 crores. The Bank’s NPA was 2.24% as compared to 2.14% in the previous quarter. The NII of the Bank grew by 17.2% on a YoY basis. The share price of the bank reacted negatively after the result announced.

Maruti Suzuki also reported its Q4 earnings on 13th May, the company reported a 28% YoY drop in the standalone net profit. The profit reported at Rs 1291.70 crores in the march end quarter as compared to Rs 1795.60 crores in the same period last year.

The total revenue of the company also declined 15.19% YoY to Rs 18198.70 crores during the quarter. Overall the company missed the street estimates and the share price reacted negatively after the Q4 results.

The next week’s Q4 earnings for the heavyweight stocks are

Q4 Earning dates for Nifty50 Stocks
18th May	Bharti Airtel
19th May	Bajaj Finance
20th May	Bajaj Auto
20th May	Dr. Reddy
20th May	UltratechCement
21st May	Bajaj Finserv

 

Reliance Right Issue

The heavyweight stock Reliance Industry is coming up with the right issue on from 20th May 2020. It is a Rs 53,125 crores right issue the biggest ever in the Indian history. The closing date of the issue is on 3rd June and the ratio is one in every share held by the investors.

The current market price of the share is Rs 1459 and the right issue price is Rs 1257. The response of the right issue can be seen from the 20th of this month and it would be interesting to see how the stock behaves after that. Any correction in the share can make market sentiment negative. Traders should follow the right issue of the Reliance Industry next week.

 

Conclusion:

We have analyzed the factors that could impact the Indian share market next week. Traders should keep track of all the above points to know the Nifty50 trends for the next week.

 

You can also read, Your Stock Broker will never say these Hidden Charges.

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