Markets were volatile and choppy in the short four-day week with a mid-week holiday on Wednesday for Independence Day. While the net weekly change was small, each day saw net movement of 200 points or thereabouts on the BSESENSEX, beginning with losses on Monday and gains on subsequent Tuesday. The same pattern was repeated on Thursday and Friday. The net change was a gain of 78.65 points or 0.21% with the BSESENSEX closing at 37,947.88 points. NIFTY gained 41.25 points or 0.36% to close at 11,470.75 points. Markets did not make new highs this week.
In primary market news. The IPO from Credit Access Grameen Limited, the microfinance company would be listing on Thursday the 23rd of August.
In news the former Prime Minister of India Atal Behari Vajpayee passed away at the age of 93. He was the first non-congress PM to complete his 5-year term. In corporate news the CFO of Infosys, Ranganath has quit after putting in 18 years at the company. He was the CFO since Bansal had quit in 2015. Probably things are not as hunky dory as one may have expected ever after the stink raised by former promoters of Infosys after the Panaya acquisition. Things at Infosys have not been the same after the induction and subsequent parting of Vishal Sikka. There has been a constant spate of resignations and the spat between the former promoters and management. One simply wonders when things would be sorted out.
The week ahead has a similar trading holiday on Wednesday and would be divided into two distinct halves. Volatility would continue to hurt the markets and a serious attempt would be made to make new highs on the benchmark indices. The new highs are less than a day’s gain away with the difference of 125 points on the BSESENSEX and 25 points on the NIFTY. While the distance is literally a stone’s throw away it could take some time to get there as neither the bull nor the bear would like to give way. This is what could lead to volatility and markets would react to any news and market performance of Dow Jones.
I have been able to anticipate the market movements over the last 6-8 weeks and the same can be reflected in the weekly calls. The July rally that unfolded was well called and is now behind us. Going forward the bull rally will end only on euphoria and that is to happen shortly. It’s during this euphoria that greed will take over and a sharp correction would unfold. The time available is under 12-15 trading days. How this would unfold is a little hazy.
Simple advice – Stick to quality, book profits and keep your ammunition dry, it will be very handy when markets correct sharply.
