Indian markets: All major indices down around 6-10% last week

 

After a bloodbath seen in the month of March, the Indian stock market made a strong comeback in the month of April 2020. The volatility had been reduced in the month of April and the India VIX index fell below 50 in April. All major indices closed in green last month. 

 

Major Indices in the Indian stock market last week

But again on the 1st day of the May series, we have witnessed a sharp fall in the market due to US President Donald Trump’s threatening for fresh Trade War with China. In the 1st week of May series, all major indices closed around 6-10% down.

We have seen a profit booking at higher levels in the last week. On a weekly basis, the Nifty was down by 608.4 points or 6.15% while Sensex declined 2074.92 points or 6.69%. The Bank Nifty fell the most it plunged by 2181.6 points or 10.15% during the week.

Some profit booking in the Nifty midcap and smallcap also seen during the week. The midcap 100 index of Nifty was down by 809.63 points or 5.96% whereas the smallcap 100 index down by 167.4 points or 4.08% during the week.

On a weekly basis NSE sectoral, Pharma, FMCG, IT & Service Sectors closed in the green whereas other sectors closed in the red. The Banking & Finance, Automobiles, Capital Goods, Electricals, and Real Estate sectors closed in a deep red last week.

 

Stocks in the news: gainers and losers

The gainers and losers of Nifty stocks in the news are as follows

Weekly Nifty50 Gainers
Company Name	LTP	Previous Close	Change (%)
Reliance Ind	1561.8	1466	6.53
M&M	386.7	366.65	5.47
Bharti Airtel	530.05	514.3	3.06
Dr. Reddy’s Lab	3984	3936.3	1.21
Sun Pharma	469	464.45	0.98
Weekly Nifty50 Losers
Company Name	LTP	Previous Close	Change (%)
Titan Company	832.85	970.05	14.14
Axis Bank	382.05	444.9	14.13
Vedanta	77.4	89.55	13.57
UPL	364.6	420.05	13.2
Maruti Suzuki	4654.15	5358.8	13.15

Weekly Nifty Midcap 100 Gainers
Company Name	LTP	Previous Close	Change (%)
Info Edge (IND)	26957.95	9547.60	5.90
Sterlite Tech	93.60	89.55	4.52
Weekly Nifty Midcap 100 Losers
Company Name	LTP	Previous Close	Change (%)
AU Small Finance	421.2	544.25	22.61
Bharat Electron	59.7	72.1	17.2

Weekly Nifty Smallcap 100 Gainers
Company Name	LTP	Previous Close	Change (%)
NIIT Tech	1402.55	1203.45	16.54
EID Parry	164.75	145.35	13.35
Weekly Nifty Smallcap 100 Losers
Company Name	LTP	Previous Close	Change (%)
Suntek Realty	154.15	197.65	22.1
Minda Ind	244.4	298.65	18.17

 

Stocks in the news last week

• Coal India to shift focus to topsoil removal as demand dips, OB removal grows 10% in April
• ITC ltd ramps up production to meet the demand for sanitizers
• Tata Motors and Ashok Leyland to pitch for incentive-based scrappage policy for the revival of CV segment
• Reliance to produce new gas from D6 by June end, to cost $2.2/unit at current oil prices. Reliance Industries’ rights issue gets Moody’s thumbs-up, Credit positive will help Mukesh Ambani to cut debt.
• The crude steel production of JSW Steel declined by 60% to 5.3 lakh tonnes in April
• Dabur India resumes its production at all manufacturing locations.
• Asian Paints partially resumes operations at some units
• Reliance Jio and  Facebook to raise the stakes against the Amazon e-commerce game that was launched in India.
• Pfizer and BioNtech are going to begin US coronavirus vaccine trial
• TVS Motor resume operations across plants in India
• HDFC to raise Rs 5000 crore via bonds
• Reliance Industries plans to buy e-pharmacy Netmeds
• Yes Bank looking to raise up to Rs 12000 crore soon
• Tata Consumer Products has tied up with Domino’s Pizza and Zomato to deliver essential goods
• Union Bank Of India Cuts MCLR by 15 bps across all tenure

Key factors that will influence the market next week are as follows:

 

Quarterly result

 

HCL Tech

HCL Tech has reported a better than expected Q4 results last week, the company reported Rs 3154 crores for the March-end quarter. It reported  22.8% upas compared to the last year while sequentially 3.8%. The share price of HCL Tech has reacted positively after the Q4 result.

Shree Cement

Last Friday Shree Cement has posted Q4 results its net profit rises 83.25% on YoY at Rs 588.15 crores for the March ended quarter. However, the company’s revenue declined 2% on Yoy to Rs 3217.54 crore during the quarter. The total expenditure declined to Rs 2647.51 crore in Q4FY20 from Rs 2927.33 in Q4FY19. The company’s Q4 result meets street estimates, the share price may react positively on Monday.  

ICICI Bank

On May 9th ICICI Bank reported 26% YoY growth in standalone profit at Rs 1221.36 crore in the March-end quarter. It has missed street estimates due to higher COVID 19 related provision. The profit for the same period last year was Rs 969.06 crores.

The bank has made additional COVID 19 related provision of around Rs 2725 crores to strengthen its balance sheet. The Bank’s NII grew by 17.1% on a YoY basis, Its asset quality improves, net NPA dropped 8 bps. The share price of ICICI Bank may see some downside due to higher provision.

The 4th Quarter results of Nifty50 stocks for next week are Kotak Mahindra Bank  and Maruti Suzuki on 13th May 

Coronavirus & Global cues

The increasing cases of coronavirus in India last week is its impact on the economy is the main concern now. As the total cases getting an increase in India and lockdown also extended. It would be watched closely next week because investors feared that this could bring the economy to a grinding halt. 

On the global front, any fresh threat from the US to China regarding the Trade War due to the spread of coronavirus can make the market sentiment negative. Further, any development in the Coronavirus Vaccine can make a V-shaped recovery in the global market and can see a bounce back in major indices in India.

 

FIIs and DIIs movement

The FIIs and DIIs are both net buyers in the cash segment last week. FIIs bought Rs 18589.68 crores whereas the DIIs bought Rs 917.92 crores in the cash segment last week. 

The FIIs made a comeback in the last two trading sessions of the week and purchased Rs 19000 plus crores on 7th May only. If the trend continues we may see an uptrend in the market next week and jump in all major indices in the Indian market

 

Macro data

The macro data for the next week are given below:

Macro Data Next Week
12th May	Industrial Production
12th May	CPI Inflaton
14th May	WPI Inflation
15th May	Foreign Exchange Reserve

 

Rupee and Crude oil movement

The Crude oil prices have made a decent gain last week on the hopes of production cut and improvement in demand. The WTI crude raises 25% while Brent crude oil future was gained 17% in the last week. 

Investors and Traders need to watch closely the crude oil prices, volatility in crude oil prices can make Indian major indices volatile.

The Indian rupee has got an appreciation of about 0. 28%  in the last week. It has closed at Rs 75.53 against the US dollar. Any weakness in the Indian rupee against the US dollar can make Indian market sentiments into negative.

 

Nifty & Bank Nifty Technical analysis

 

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) @ 9500 whereas All Down Moves Initiates Short Covering (Buy) @ 9030

If Nifty futures share price Moves Above 9284 and sustain. Then you should Buy with 1st Target of 9322 during the week with a Stop Loss of 9180 FOR the Target of 9322- 9374- 9427- 9504

If Nifty futures share price Moves Below 9180 and sustain. Then you should Sell with 1st Target of 9056 during the week with a Stop Loss of 9185. FOR the Target of 9146- 9118- 9030- 8960

 

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) @ 19980, whereas All Down Moves Initiates Short  Covering (Buy) @ 18700

If Bank Nifty share price future Moves Above 19480 and sustain. Then you should Buy with 1st Target of 19620 during the day with a Stop Loss of  19125. FOR the Target of 19620 – 19750- 19975- 20220

If Bank Nifty share price future Moves Below 19125 and sustained. Then you should Sell with 1st Target of 19020 during the day with a Stop Loss of 19480. FOR the Target of 19020 – 18876- 18740-18380

Conclusions

All major indices of the Indian stock market have corrected last week due to global cues and concern over the increasing number of coronavirus cases in India. The delay in fiscal stimulus, increasing coronavirus cases in India can make the market sentiments negative next week. The further extension of lockdown, Q4 results and credit rating may add some fuel to the negative sentiments in the coming week.

Traders should remain cautious and trade with strict stop loss in the next week. Traders can also follow our Nifty and Bank Nifty share price target, market updates, and stocks in the news on a daily basis.

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