Benchmark index has gradually rose for the last three sessions suggesting strength for an upside in the index from a technical perspective.
Furthermore, the index has given closing above 21&9 SMA, which suggests a northward direction in the counter. A daily momentum indicator MACD & Stochastic is trading with a positive crossover which suggests upside momentum in the upcoming session.
At present, the Index has support at 17300 levels while resistance comes at 17600 levels. Once the market settles above the immediate resistance, we may see further upside till 17800/18000 levels.
Last week, Indian equity benchmarks managed to surge nearly 1.8% as market sentiments got some relief from the rising concerns over "Omicron variant".
Heavyweight banking stocks supported benchmarks gain this week as RBI maintained the accommodative stance by keeping interest rates unchanged. Metal index outperformed the benchmarks this week as fear over severity of new variant COVID-19 variant ‘Omicron’ eased. Heavyweight stocks like ICICI Bank, Reliance Industries and Infosys were among the top contributors to benchmarks gain this week.
Two large real estate developer companies in China ‘Evergrande and Kaisa’ defaulted last week on missing debt payments. While market sentiments got relief as China’s central bank moves to ease liquidity amid real estate crisis by pumping nearly $188bn in economy and reducing reserve requirements for banks to improve liquidity and boost economy.
But the rise in US inflation, as indicated by US President Biden, will provide some direction to the US Fed policy meeting scheduled in the coming week.
Going ahead, next week’s US Fed policy decision, COVID-19 related news, global economic data and US Fed’s taper plan will stay in investor’s radar next week.
Top Weekly Gainers/ Losers
• Metal stocks remained under buying radar this week as fear over severity of new variant COVID-19 variant ‘Omicron’ eased.
• Sharp recovery witnessed in beaten down metal stocks; Tata Steel and Hindalco were among the top gainers this week.
• Hindalco remained under investor’s radar this week by surging ~7% as government imposed anti-dumping duty on flat rolled aluminium products imported from China.
• ITC stock surged ~6.4% in one week as investors keep an eye over upcoming analysts meet
• Investors keep Asian Paints stock on buying radar on price hike, lower crude oil prices and better demand prospects
• ICICI Bank posted rally in this week due to value buying
• As concerns over Omicron eased this week, Pharma stocks witnessed some profit booking.
(Ankit Pareek, Research Analyst at Choice Broking)
