A bleak week and there's not more sunshine to follow
Friday, the 13th, spelled some doom as the Nifty closed on a weak note at 7814.90 on May 13. This was because of the world market’s negative outlook and selling pressure brought on by profit booking. Nifty has support at 7775 and 7700. Chances of the Nifty moving down below these two levels though are remote.
Key resistances for the Nifty are at 7911 and 7998. On Friday, India VIX jumped up by around 4.1 per cent to 16.99 per cent, indicating cautious market outlook in the beginning of this week. On Friday, Dow Jones too closed lower due to poor quarterly earnings of corporates. European markets, too closed in negative territory with expectation of poor GDP growth. If Nifty comes very close to 7700, one can initiate long positions with appropriate stop-loss.
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Currency fluctuations
The Japanese Yen started showing weakness against the US dollar, and it made a base at 106. It is likely to weaken further and may move down towards 108.65, and, can help the equity markets around the globe.
Crude oil too, moved up on concerns of the wild fire in Canada. It is likely to show further strength towards $47.53. It has support at $44 and $43.01 per barrel, and can also support the market positively.
According to the Meteorological (MET) department, the monsoon will hit Nicobar Islands in just four days, if there is a good monsoon in India, it will act as a catalyst for the Indian equity markets. The country is currently suffering from a drought with many places having low or no water. This news comes as a relief.
A few mid cap public sector banks were out with quarterly earnings. Banking Nifty has support at 16593 and 16110. Resistances are at 16941 and 17057.
The Consumer Price Index rose to 5.39, against 4.8 per cent earlier. CPI inflation shot up from 4.54 per cent to 4.67 per cent. Market participants worried about high inflation, because the RBI would hold off on cutting rates at its June policy meet.
New moves
In the latest move by SEBI, plans to tighten due diligence requirement for issuance and transfer of P-notes, to ensure compliance with anti-money laundering law was made. SEBI board will meet on May 20 to take necessary steps.
India’s industrial output growth was down in March at 2.4 per cent in FY16 from 2.8 per cent in the previous fiscal. Manufacturing output declined to 1.2 per cent in March compared to a growth of 2.7 per cent in the same period a year ago.
Capital goods sector contracted by 15.4 per cent while the power sector achieved a growth of 11.3 per cent.
Disclaimer: No financial information whatsoever published anywhere in this newspaper should be construed as an offer to buy or sell securities, or as advice to do so in any way whatsoever. All matter published here is for educational and information purposes only and under no circumstances should be used for actual trading or making investment decisions.
Readers must consult a qualified financial advisor prior to making any actual investment or trading decisions, based on information published here. Any reader taking decisions based on any information published here does so entirely at his or her risk.
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