The stock market movement in the coming week will be guided by the decisions from the US Fed meet and new developments that may occur on the Russia-Ukraine crisis.
Technically, the benchmark index Nifty has traded in a narrow range and formed inside bar candlestick on the daily chart. Moreover, it has been trading below Middle Bollinger Band formation, which indicates further resistance around 16,850 levels.
However, the Stochastic and MACD is indicating positive crossover, which suggests that the downside move is capped and price may reverse upward. So for the coming week, if Nifty50 manages to sustain above 16,850 mark then we may see the up move till 17,000/17,200 levels. At present, the index has support at 16350 levels while resistance comes at 16,850 levels.
Overall, we are having a cautious view with a positive bias as the US February CPI inflation recorded a 40 year high (before the oil spike) due to high gasoline, food and housing cost, adding doubts to global equity market trend.
Stock markets recover
In the week ended March 11, domestic market recovered sharply after a continuous fall as the Nifty index inched up by 6 percent from the weekly low at 15,671.45 levels and settled at 16,630.45 on the last trading day of the week.
Bank Nifty rose by 10 percent from the weekly low at 32,155.35 levels and settled at 34,546.25 on Friday.
BJP victory, oil prices impact stock markets
The recovery in the domestic market last week was tracking the Asian markets that mirrored the effect of cooling of oil prices and BJP victory in state elections, especially in Uttar Pradesh.
The recovery was also attributed to the resumption of diplomatic talks between Russia and Ukraine that also boosted the investor’s confidence across the globe but the sentiments remained cautious ahead of European Central Bank’s monetary policy meeting and US Fed meeting scheduled this week.
Top weekly Nifty gainers and losers
Cipla: The company has received an approval from Central Drugs Standard Control Organization to conduct local trials on anti-Covid19 pill Paxlovid.
Sun Pharma: Its US subsidiary has completed the acquisition of subsidiary companies of Galderma for a consideration of $99.3mn.
Bharti Airtel: Bharti Airtel has announced to acquire 9 percent stake in Avaada CleanTN project.
Asian Paints: Positive development on the Russia-Ukraine crisis and consequently easing in the international crude price levels led to a rally in the share price.
Britannia Ind: Anticipating higher inflation coupled with subdued rural demand, mainly led to a negativity in the stock.
Eicher Motors: Anticipating higher cost of sales, subdued demand and pressure on profatibility led to negativity in the share price.
Maruti Suzuki: Anticipating higher cost of sales, subdued demand and pressure on profatibility led to negativity in the share price.
(Vivek Agarwal is Associate, Choice Broking)