It was a shortened week at the bourses with a holiday on Tuesday because of Dusshera. It was a relief as markets fell that much less. Benchmark indices lost on all four days of the week. BSESENSEX lost 1,779.34 points or 2.38% to close at 72,894.95 points while NIFTY lost 602.60 points or 2.61% to close at 22,516.40 points. BANKNIFTY lost 1,556.65 points or 2.79% to close at 54,287.35 points. Broader markets saw BSE100, BSE200 and BSE500 lose 2.69%, 3.23% and 3.75% respectively. BSEMIDCAP lost 3.46% while BSESMALLCAP was down 4.66%. There were no sectorial gainers and the one to fall the least was BSETECH which was down 0.35%. The worst performer was BSECAPITAL GOODS, which lost 7.54%. It was a four day blood bath on the bourses and the biggest cause for worry is crude oil which is around 117$. 

The Indian Rupee lost 16 paisa or 0.17% to close at Rs 95.13 to the US Dollar. Dow Jones gained on three of the five trading sessions and lost on two. It was up 212.75 points or 0.41% to close at 52,215.16 points. 

The event of the week was the launch and successful completion of India’s biggest IPO, Jio Platforms Limited. The Rs 30,200 crores issue in a price band of Rs 1,065-1,119 was oversubscribed a massive 22.19 times. It has become the most application garnering issue not only in India but the globe, with a subscription number of 1,34,05,794 application forms. This makes this number a world record and will take a lot to be beaten in the future. The breakup of subscription saw QIB portion subscribed 70.55 times, HNI 14 times, Retail portion 2.72 times, Shareholders portion 7.6 times anḍ Employee portion 2.93 times. In the retail segment, the number of applications exceeded 1 crore which makes the entire issue subscription ‘AWESOME’ and keeps one wondering what happened. It has taken the markets by storm and caught most ‘pundits’ on the wrong foot. The share would list on Wednesday the 28th of October. The grey market premium has been moving in a broad range of Rs 240-250, which makes the trading range for listing day at Rs 1,360-1,370, with lower levels of Rs 1,340 or thereabouts and Rs 1,390 or thereabouts on the higher side. It would be interesting to note what fresh institutional purchases happen on that day in the counter. 

There were six mainboard listings during the week, with four of them being on Friday. Suffice to say that the listing performance did not extend from subscription. Bonfiglioli Transmission Limited had issued shares at Rs 586 and was oversubscribed 46.06 times. The share traded in a range of Rs 527.40-607, and finally closed at Rs 576.35, a loss of Rs 9.65 or 1.65%. 

Yet another share was Zetwerk Manufacturing Businesses Limited which had issued shares at Rs 151. The issue was subscribed 3.1 times. The trading range of the share was Rs 127.40-161 and the share closed at Rs 138.30, a loss of Rs 12.70 or 8.41%. 

The other two shares to list on Friday were Tonbo Imaging India Limited which had a stellar performance and gained Rs 433.65 or 61.95% to close at Rs 1,133.65. 

The fourth listing was from Sahajanand Medical Technologies’ Limited and gained Rs 34.20 or 9.94% to close at Rs 378.20.The present value of NIFTY at 22,516.40 points is lower by 167.35 points or 0.74% compared to the opening level of 22,683.75 points. With just 2 days to go, the bears have the advantage bas crude at 117 dollars is not comfortable for anyone. We also need to understand that next Tuesday, the 3rd of November, the US mid-term elections would be held and this time around the whole world is glued to see what happened just before and after the elections to Trump.    

Markets in the coming week will be under pressure due to crude at new levels. Support on the NIFTY exists at levels of around 22,200 points and lower at 21,700-21,800 points. On the resistance side, we have levels of 22,700-22,800 acting as very strong resistance. The strategy would be to refrain from fresh long positions and to sell or lighten positions on any short covering rally that may happen. 

Conserve cash and hold on to cash. One doesn’t know when cash will make you win a lottery.

Markets had extra drama last week and things ended on a weekly basis as expected, on a positive note. The consecutive eight week losing streak ended as expected and predicted with markets gaining. What the week ahead holds for us, only time will tell. BSESENSEX gained 534.53 points or 0.74% to close at 72,544.66 points while NIFTY gained 89.65 points or 0.40% to close at 22,535.65 points. BANKNIFTY gained 805.90 points or 1.48% to close at 55,256.65 points. The broader markets saw BSE100 gain 0.20%, while BSE200 AND BSE500 lost 0.02% and 0.08%. BSEMIDCAP lost 1.38% while BSESMALLCAP lost 1.18%. The top sectorial gainer was BSETECH which gained 1.84% while the top loser was BSEREALTY which was down 4.19%. Markets gained on three of the five trading sessions and lost on two.

The Indian Rupee lost 54 paisa or 0.56% to close at Rs 96.95 to the US Dollar. Dow Jones gained on four of the five trading sessions and was up 477.99 points or 0.93% to close at 51,654.95 points.

RBI in its MPC meeting held between the 5th and 7th of October decided to raise Repo rate by 25 basis points to 5.50%. This rate hike has happened after February 23, when rates were last revised.

The highs and lows made intraweek on BSESENSEX and NIFTY were at 73,018.82 points and 22,731.85 points which were made on Wednesday. The lows which were made on Thursday were at 71,327.75 points and 22,179.90 points. Lows were made on Thursday when BSESENSEX lost a massive 1,177 points and 387 points on NIFTY. The tables were turned more or less completely on Friday when markets gained 1,083 points and 319 points respectively. There are no substantial reasons for either the fall on Thursday or the rise on Friday, just the usual FPI selling and weak global cues.

Donald Trump has tweeted that the USA has signed a deal to buy Russian Diesel. This signals that there will be no sanctions on countries dealing with Russia and the Ukraine-Russia conflict is over. This clearly shows what diplomacy and global politics the USA and in particular its President is indulging in. India’s stand is vindicated on crude purchases. With the Nobel Peace prize having been announced, Trump’s frustration has once again come to the fore. He believes he should have been awarded eight peace awards as he has ended eight wars. Less said about Donald Trump the better.

The mother of all IPO’s from Jio is finally here. The issue would open from Wednesday the 21st of October to Friday the 23rd of October. The price band is Rs 1,065 to 1,119 and the issue size would be under Rs 31,000 crores, making it the largest IPO ever, beating the one from Hyundai Motors.

Coming to the markets in the week ahead, we have bounced yet again from levels of 22,200 points and this becomes a strong support for markets. The level of 22,200 would be a support and if this were to break a level of 21,700 would act as support. On the upside, levels of 22,800 would act as an immediate resistance. If the level was breached upwards, we have room to move up to 23,200-23,300 points. Global scenario seems to be improving with Trump realizing that things are not going his way and the 3rd of November election is just round the corner. Not sure how things would unfold, but USA could see dramatic events unfolding.

The trading strategy would be to play long with a strict stop loss at 22,200 points and buy on dips. Things should improve for the markets in the immediate short term. There is yet another silver lining for Indian IT companies as more and more people are realizing that India not committing heavy expenditure for AI is actually a blessing in disguise as Chinese companies are able to offer products substantially cheaper than the Americans. This situation could actually spur investments in Indian IT stocks all over again.

Trade cautiously.