Amid volatility, Indian equity market managed to close near record high levels during the week gone-by led by the strong gains in auto, banking and IT stocks.

Heavyweight stock ‘Reliance’ was among the top contributors to index gains this week as development related to ease in travel restrictions across globe is a positive trigger for oil & gas companies. Other positive triggers which led to strong rally in Reliance stock are favorable telecom policy and Reliance retail deal with 7-Eleven stores.

Market also drew support from RBI credit policy that kept repo rate unchanged while maintaining the accommodative stance.

On the global front, sentiments remained buoyed after getting some relief from ongoing debt ceiling debate. Positive development related to US debt ceiling cheered market sentiments as US lawmakers agreed to raise government’s debt limit that would avert a national default and economic crisis.

After a massive selloff in IT stocks in previous week, strong comeback in buying was seen in IT stocks during the week. Investors kept Indian auto major ‘Tata Motors’ on buying radar which surged nearly 15% amidst report of improving business outlook.

In the coming week, investors will closely monitor key economic data such as Indian industrial production and inflation data, India credit growth, US FOMC minutes and OPEC monthly report.

During the week, benchmark indices moved nearly 1.8% in comparison with the previous week along with a strong closure while Bank Nifty gained nearly 1.4%.

The main pullers to help Nifty climb up were IT sector which gained above 4.5%, the Media Sector up 4.69%, the Auto Sector up 4.2% and the Energy sector up 3.9% while loses were seen in FMCG and Pharma sectors with 1% and 0.5% respectively.

Stocks like Tata Motors showed extraordinary gain of above 15%, ONGC gained above 10%, Titan rallied above 9% while on the losing front no stocks ended negative on a weekly basis.

On the technical front, the benchmark indices settled above the 50 and 20 days EMA indicating a bull trend. The stochastic indicator has given a positive crossover on weekly as well as daily time frames indicating a further northward journey. The index has closed above the Super Trend Indicator, which indicates further strength. Also, the momentum indicator is pointing upwards, indicating bullishness.

Nifty has a support of 17500 while resistance of 18000 levels. Overall, the index can be seen making fresh lifetime highs.

Gainers and Losers

• Sentiments were buoyed towards Auto stocks amid festive season. Stocks like Tata Motors, M&M and Maruti Suzuki outperformed this week. Tata Motors outperformed this week (+15%) amidst report of improving business outlook.

• ONGC (+10%) continues to rally on the back of rally in crude oil price.

• Titan surged nearly 9 percent in one week due to strong demand recovery in Q2FY22.

• The major weekly gains in index were mainly attributed by the Reliance. Key triggers which led to rally are i) Ease in travel restrictions across globe, ii) Favourable telecom policy and iii) Announcement of Reliance retail deal with 7-Eleven stores

• Grasim stock price fell 4.6% in one week as company receives income tax demand of Rs. 8,334 crores.

(Ankit Pareek is Research Analyst, Choice Broking)