Indian Market Weekly Outlook by Epic Research
Indian market faced massive selling during the week and majority of panic in the local market was due to global cues. Indian stocks ended the week lower and NSE Nifty dropped below crucial support level. Indian Public Sector Banks spoiled the sentiment as continued selling in some of major banking counters led to decline in benchmarks. Banks are suffering from major crisis after bank guarantee scam by Nirav Modi and Gitanjali Gems.
During the week, U.S. President Donald Trump announced tariffs on steel and aluminum imports. The tariffs were condemned by majority of world leaders but President Trump continued with his plan to announce tariffs. After the announcement, Dow Jones Industrial Average still managed to close with minor loss on Thursday.
Indian Stock Market outlook by Epic Research follows...
Nifty ends down on the back of pressure at higher levels despite a positive open and cues. Indices tracked the cues from global markets and Asian markets which opened higher for the day. A higher opening we observed wasn't able to sustain the higher levels. The levels of Nifty which were crucial on the upside is now been placed at 10300 since European markets opened the day on a negative note.
The RSI on a short-term time frame which was reversing from oversold zone tested a resistance at 50 levels which gave bears an opportunity to weigh more on the short term trend towards their favor. We expect the range to continue and once we breach lower support established at 200 Days SMA at 10150 levels, if taken out, then we may see further bearish momentum building up. Investors and Traders should utilize any pullback to exit the position while riding the bearish momentum for a medium-term look favorable strategy.
On The Fundamentals Side, We expect next week to add some more action due to slew number of data that are coming in. The industrial production data which has been on rise since Last October is showing signs of revival in the underlying economy. It was at 7.1 in January as compared to 8.8 in November while it is expected to be at 6.7 – 7.1 in the coming week and any dent here will spill the fears of hangover effect of policies implemented.
With that all eyes will be on Manufacturing Output and CPI data. CPI data has been crucial for bonds market and its effect on Indian equity markets since last 6 month and it was at 5.07% as compared to above 5.2 levels. So that needs to be accounted for as well. These data will add more action since any deviation than what is expected on street will pull a full trigger for the Bears.