Markets in the week gone by began with a trading holiday. At the end of the week, they had lost on two of the four trading sessions, having gained on two. They ended with minor gains but are indicating that there could be a change in trend if markets are able to gain from here and also defend their support. Just early indications but the possibility is opening up. BSESENSEX gained 167.22 points or 0.25% to close at 65,995.63 points while NIFTY gained 15.20 points or 0.08% to close at 19,653.50 points. The broader markets saw BSE100 gain 0.05% while BSE200 and BSE500 lost 0.10% and 0.02% respectively. BSEMIDCAP lost 0.81% while BSESMALLCAP was up 0.79%. Very clearly the breadth is yet to move with the benchmark indices. 

The Indian Rupee lost 20 paisa or 0.24% to close at Rs 83.24 to the US Dollar. Dow Jones lost on three of the five trading sessions and gained on two sessions. At the end of the week, Dow Jones was down 99.92 points or 0.30% to close at 33,407.58 points. 

In primary market news, we saw three listings during the week. The first to list was JSW Infrastructure Limited which had issued shares at Rs 119. The share had a stellar listing and closed on debut at Rs 157.30, a gain of Rs 38.30 or 32.18%. By the end of the week, they gained further to close at Rs 171.60, a gain of Rs 52.30 or 44.20%. 

The second share to list was facility management company, Updater Services Limited, which had issued shares at Rs 300. The share is still struggling to close at or above its issue price. The share listed on Wednesday and closed at Rs 283.85, a loss of Rs 16.15 or -5.38%. In the remaining two days of the week, it gained marginally to close at Rs 285.40, a loss of Rs 14.60 or -4.87%. 

The third and final share to list was Valiant Laboratories Limited which had issued shares at Rs 140. The share which listed on Friday had an excellent start and closed at upper circuit. The share closed at Rs 169.05, a gain of Rs 29.05 or 20.75%. 

It appears there is a brief hiatus in the markets as far as primary markets are concerned. Its more to do with two reasons, firstly that the validity of documents with March results or financials is over for purposes of bringing IPOs. The second is investors consider this period inauspicious and refrain from investing in IPOs. Whatever be the reason, the break is well appreciated as the pace of IPOs had become a bit too much. September saw as many as 11 issues list on the main board and there have been as many as three listings in October so far. 

RBI in its monetary policy review kept key lending rates unchanged on expected lines. 

In global news, there was a sudden firing on the Israel-Palestine front which had led to a declaration of war. One does not know what would be the developments of this war and how things would shape up. However, in the short term it’s one more uncertainty in global events. 

SEBI is looking at the possibility of allowing trading in fractions of shares. When this becomes operative is not yet certain but would allow people to own shares which are expensive in absolute terms. Say for example an MRF which trades at Rs 1,07,500 or Page Industries which trades at Rs 39,400. This will bring about affordability in ownership of a different kind. Early days but distinct possibility. 

The markets seem to be at crossroads and need to decide where they are headed. In the week gone by, they broke crucial support of 19,600 on NIFTY, made a low at 19,333 on Wednesday the 4th of October, and rebounded quite smartly. They made a high of 19,675 points on Friday and closed at 19,653 points. The area of 19,600 to 19,650 is an important zone and becomes critical for markets going forward. There are two distinct possibilities here. The first which indicates bearishness is that we fail to sustain these levels and after some upward movement break 19,600 level decisively. Go below 19,200 level and continue downwards. 

The second scenario which is bullish and yet to fully unfold is that we build from these levels upwards. In the process the first hurdle upwards would be 19,825-19,850 and then 20,200 levels. What would happen ultimately, your guess is as good as mine currently. The immediate requirement is that we should cross and sustain 19,850 without breaking 19,600 levels. If this happens, the fact that FPIs are currently net sellers for quite some time, may be forced to become buyers and cover shorts. 

The trading strategy for the week ahead would be to continue to sell on strong rallies and buy on sharp dips. We could be in the midst of a trading market with the range expanding. Take advantage of intra-day swings. 

Trade cautiously.

It was a topsy turvy week that went by. Markets were flat for the first two trading sessions, and then gained, lost and ended the week with gains. Expiry day was weak and on expected lines while the first day of a new series saw gains for the market. At the end of it all, BSESENSEX lost 180.74 points or 0.27% to close at 65,828.41 points, while NIFTY lost 35.95 points or 0.18% to close at 19,638.30 points. Monday, markets were so flat that the net change in the NIFTY was in only decimal points. The broader markets saw BSE100 lose 0.12% while BSE200 and BSE500 gained 0.03% and 0.19%. BSEMIDCAP gained 1.23% while BSESMALLCAP gained 1.36%.

The Indian Rupee lost 11 paisa or 0.13% to close at Rs 83.04 to the US Dollar. Dow Jones continues to be on the losing spree. It lost on three of the five trading sessions and gained on two. Dow was down 456.34 points or 1.34% to close at 33,507.50 points. 

The primary markets continue to remain in focus. We saw three issues open and close for subscription last week. There were three listings during the week as well. Currently there are two issues which are open for subscription. With these two issues closing there will be a brief hiatus of main board issues for at least a fortnight. 

The issue from JSW Infrastructure Limited which was open from Monday the 25th of September to Wednesday the 27th of September was subscribed 39.36 times overall. The QIB portion was subscribed 60.12 times, HNI portion was subscribed 16.83 times and Retail portion was subscribed 10.86 times. There were 16.90 lac applications. The issue would listed on Tuesday the 3rd of October. On the basis of allotment, one saw a strange pattern of bidding where 17 applications bid for roughly 85 lac shares in the 10 lacs plus HNI category and about Rs 101 crs in value. This implied an average bidding size of 5 lac shares against the bulk of bidding which happened for 8,442 shares. At this size there were 44,435 bids and accounted for 95.54% of the applications in the category. The whole idea was to distort the bidding process and give a different look to the demand. Suffice to say that there is nothing illegal about it.

The second issue was from Manoj Vaibhav Gems N Jewellers Limited which had tapped the markets with its issue in a price band of Rs 204-215. The issue was subscribed 2.33 times overall with QIB portion subscribed 1.08 times, HNI portion subscribed 5.40 times and Retail subscribed 1.73 times. There were 99,893 applications in all. 

The third issue was from Updater Services Limited which had tapped the markets. The issue was open from Wednesday the 27th of September to Friday the 29th of September. The issue was subscribed 2.96 times overall with QIB portion subscribed 4.50 times, HNI portion undersubscribed at 0.89 times and Retail subscribed 1.45 times there were 49,715 applications. 

The first share to list was Signature Global (India) Limited which had tapped the markets with its issue at Rs 385. The share listed at Rs 444 and closed day one at Rs 458.40, a gain of Rs 73.40 or 19.06%. It closed the week at Rs 477.90, a gain of Rs 92.90 or 24.13%. 

The second share to list was Sai Silks (Kalamandir) Limited which had tapped the capital markets with its issue priced at Rs 222. The share debuted at Rs 242.15 and closed day one at Rs 244.85, a gain of Rs 22.85 or 10.29%. It closed the week at Rs 253.20, a gain of Rs 31.20 or 14.05%. 

The third share to list was Yatra Online Limited which had issued shares at Rs 142. The share debuted at Rs 130 and closed day one at Rs 135.95, a loss of Rs 6.05 or 4.27%. On Friday the share recovered a bit and closed at Rs 136.90, a loss of Rs 5.10 or 3.59%. 

September futures expired on a weak note and the series loss was 136.35 points or 0.69%. The series ended at 19,523.55 points. Incidentally the series lost 193 points on Thursday, expiry day and prior to the same, the series was actually positive. Suffice to say that the bulls lost their way and bears clawed back on the final day. 

The quarter July to September has ended and in another ten days or so, results for the quarter would start to be declared. This is a crucial quarter and market trends going forward would be determined post these results. Expect markets to be choppy and volatile. We have during the last week managed to take support at the lower end of the pivot of 19,600 points on NIFTY and this level no longer holds comfort. The new levels of support are 19,200 and 64,500 points. Resistance is at 19,800-19,850 points and 66,500-66,650 points respectively. 

Monday is a trading holiday in India. IT major Accenture has declared results in the US which are disappointing and the top losers in India were from the IT pack. This sector is crucial going forward and would be keenly watched. The strategy would be to look at buying on sharp dips and selling on rallies. 

Trade cautiously.