Markets behaved on expected lines
in the previous week. They gained on four of the five days in the trading week.
During the rise through the week, markets filled the gap of 13th
June quite comfortably. It could now be said that the immediate short-term
trend of the markets is upward and we would see markets gaining further from
hereon. BSESENSEX gained 1,573.91 points or 2.97% to close at 54,481.84 points
while NIFTY gained 468.55 points or 2.97% to close at 16,220.60 points. The
broader markets saw BSE100, BSE200 and BSE500 gain 3.22%, 3.25% and 3.25%
respectively. BSEMIDCAP gained 3.64% while BSESMALLCAP was up 3.36%.
The Indian Rupee was under
pressure against the US Dollar and lost 21 paisa or 0.27% to close at Rs 79.25.
The performance of the Rupee against other currencies has been more positive
and it is actually stronger compared to most of them.
NTPC has commercialised the
largest floating solar PV plant at Ramagundam reservoir in Telangana. The
project is of 100MW and the successful launch of this would see many more
projects going live in the times to come. The advantage of floating projects is
two-fold where one there is no cost or issues of land acquisition and secondly,
they help in conservation of water as evaporation reduces significantly.
Result season for the quarter
April to June has begun with TCS being one of the first amongst the large
companies to declare results. While revenues were on expected lines, the profits
were under pressure due to higher manpower costs. These were on account of
attrition which has been high. Further there has been a significant increase in
travel costs as businesses return to in-person meetings compared to zoom calls.
One would like to see when other companies like Infosys and Wipro declare their
results whether this was unique to TCS or experienced by all the players.
Rains or monsoon has covered a
large part of the country and it is encouraging as of now. While we have
experienced floods in Assam, this is something which happens more often than
not in that part of India. Going forward the advancement of the same in the
entire country will help in reigning inflation and price rise to a great
extent.
The markets in the week gone by had
their rallies almost all through the period. It was only on Tuesday where they
gave a scare with markets opening gap up, gaining further and then not only
giving up the gains, but closing in the red. One could be sure that at that
point of time it would have given goosebumps to a number of people. Anyway
Wednesday, onwards the market took things under control and added gains on
every day thereafter.
FPI activity seems to have
reduced with selling seeing to have been much lower than earlier. They were sellers
on Monday but were buyers on Tuesday. On the remaining three days though
sellers, it was in triple digit only. The net figure for five days of trading
was Rs 2,218 crs which in the month of June averaged a daily sale of Rs 2,600
crs plus.
Coming to the week ahead, one
should expect markets to build on the momentum made in the previous week and
gain further ground. While the gap of 13th June has been taken care
of, we now have an upward gap made on 30th May to take care of. This
gap was made when the markets opened with a big gap on Monday. The levels to be
countered are 54,936-55,466 on BSE and 16,370-16,506 on NSE. The gap needs to
be filled and markets to sustain themselves above the gaps. Once they do that
the next level of resistance would be at 56,350-56,450 on BSESENSEX and
16,750-16,800 on NIFTY.
On supports the first level would
be top of the gap which we crossed last week at 54,205 and 16,172 points. The
support would be in the range of 54,000-54,200 and 16,100-16,172. This would be
followed by 53,650-53,850 and 15,800-15,850 respectively.
While the trend and momentum are
in favour of the bulls, one must remember that the results season has started
and the announcement could lead to individual shares and then their sectors
getting impacted. The strategy for the week would be to play for the markets
gaining further ground and moving up. A note of caution would be that while
there would be rallies, it would not be a one way street and markets would have
their customary bouts of gains and losses happening.
Trade cautiously with a positive
bias.