It was a tough week at the markets and almost all people were caught on the wrong foot in terms of movement. They were volatile and markets kept one eye on US markets all the time. With sharp gains registered on Wednesday and Friday, markets just about managed to survive and at the end of the week closed with small losses. SESENSEX lost 271.32 points or 0.47% to close at 57,919.97 points while NIFTY lost 128.95 points or 0.74% to close at 17,185.70 points. The broader indices saw BSE100, BSE200 and BSE500 lose 1.05%, 1.33% and 1.45% respectively. BSEMIDCAP was down 2.66% while BSESMALLCAP lost 2.26%.
The Indian Rupee lost 3 paisa or 0.04% to close at Rs 82.35 to the US Dollar. Dow Jones lost and gained on alternate days with losses on Monday, Wednesday and Friday and gains on Tuesday and Thursday. Dow Jones gained 338.07 points or 1.15% to close at 29,634.83 points. Data on inflation was not great but markets reacted with sharp losses and then gains on Thursday. Finally profit taking on Friday saw gains of the previous day being halved. There is now almost total consensus that at the next meeting of FED, rates would again be hiked by the customary 75 basis points.
In what is a worrying trend for Americans, 30year fixed mortgage rates which were at 3% a year ago have more than doubled to 6.9% currently. This rate is the highest in the last 20 years and it is affecting the common American significantly.
In primary market news the offer for sale from Tracxn Technologies Limited was subscribed 2 times overall. The QIB portion was subscribed 1.66 times, HNI portion remained undersubscribed at 0.80 times while Retail was subscribed 4.85 times. The issue received about 89,000 applications and against an issue size of Rs 308 crs, garnered subscription of Rs 480 crs including anchor portion.
The hugely successful issue from Electronics Mart India Limited would be listed on Monday the 17th of October. The company had garnered subscriptions worth Rs 26,675 crs against its issue of Rs 500 crs. The allotted price would be Rs 59.
Markets are entering the last trading week before the end of Samvat 2078. Currently during Samvat year 2078, BSESENSEX is down about 2,150 points so far. In the remaining five days will this gap be narrowed or increase is a million-dollar question, for which there are no definitive answers.
In the week ahead markets will continue to be volatile and remain results focussed. The IT pack saw TCS, Wipro and Infosys declare results in the last week. While TCS and Infosys were ahead of the street, Wipro faltered. The saving grace for Infosys was the announcement of a market buyback which is 1.3 times the size of the interim dividend announced. The dividend would mean a pay out of about Rs 700 crs. Not sure whether the buy out would make any significant difference to the price.
The highs were made at 58,578 points and 17,428 points on the BSESENSEX and NIFTY respectively two weeks ago will be significant resistances and one would need strong momentum to surmount these levels. On the support side, levels of 57,250 and 17,000-17,050 should act as strong supports. In case of violations, strong support is there at a fortnight ago level of 56,150 and 16,750 which would act as support.
The heart and the mind say that the markets have steam in them. Whether the upside starts from these levels or after trying to establish a bottom is unknown. The strategy would be to avoid shorting at the current levels and allow markets to gain some ground before doing so. Allow markets to find their levels before any direction or trend is ascertained.
