Investors could also take a note of proceedings in the Parliament along with global movements on oil as well.
A good surge in midcaps, defensives as well as index heavyweights such as Reliance Industries ensured that the market managed to end the week on a positive note, with the Nifty closing well above 11,000.
Sectoral indices such as IT, pharma, infra, banks and energy boosted the upmove as well. Metals and auto were the top losers among other sectors.
The day began on a flat note, following tepid global cues, but indices soon gathered strength as buying resumed in the midcaps space. The rupee managed to fall to a new low of 69.12 to the US dollar, which boosted IT stocks as well. Investors also looked to place their bets on another defensive sector—pharmaceuticals.
The Sensex was up 145.14 points or 0.40% at 36496.37, while the Nifty is up 53.10 points or 0.48% at 11010.20. The market breadth is negative as 1,146 shares advanced, against a decline of 1,396 shares, while 154 shares are unchanged.
mong stocks, Infosys, Sun Pharma, Bajaj Finserv and Baja Finance have been the top gainers, while Bajaj Auto, Vedanta, and HPCL lost the most.
For the week, the market ended on a flat note, while the midcap index (-1.1 percent) and bank Nifty was down 0.20 percent.
“Focus next week would continue to remain on ongoing quarterly results and political developments. Also it is important to see the outcome of GST council meet on rationalizing tax rates on some items, taking into account the revenue considerations. F&O expiry is also likely to keep volatility high during next week. Globally, one needs to focus on trade war related developments, impact on dollar index as well as oil prices. Further fall in oil prices would be welcomed by the markets,” Teena Virmani, Vice President – Research, Kotak Securities said in a statement.
For the week ahead, earnings, IPO as well as movements on the rupee, among other factors, will be in focus for the market:
Over 270 BSE companies to declare results:
The Street will take a note of several companies which will be declaring their earnings in the upcoming week. 278 companies listed on the BSE will announce their June quarter numbers and there are several major names in the fray.
The key names include ACC, Delta Corp, Granules India, Hindustan Zinc, ICICI Securities, L&T Infotech, Saregama India, Tejas Networks, United Spirits, Vijaya Bank, V-Mart Retail, Welspun Corp, Asian Paints, Hexaware, ICICI Prudential, Inox Leisure, Symphony, Ambuja Cements, Canara Bank, Hero MotoCorp, JSW Steel, Jubilant Foodworks, PVR, Oriental Bank of Commerce, Dr Reddy’s Laboratories, ITC, Maruti Suzuki, ICICI Bank, Tata Power, Yes Bank, Bank of Baroda, HCL Technologies, NTPC, Persistent and Unichem Labs.
IPO:
The upcoming week will see another company hitting the primary market with its initial public offering.
HDFC Asset Management Company (AMC)’s IPO will open on July 25, 2018 and closed on July 27, 2018. The price band for the IPO is fixed at Rs 1,095 to Rs 1,100 per share.
Bids can be made for a minimum lot of 13 equity shares and in multiples of 13 equity shares thereafter.
In March, the board of directors of HDFC had approved offering up to 85,92,970 equity shares of Rs 5 each of HDFC AMC representing 4.08 percent of its then existing issued and paid-up equity share capital, by way of an offer for sale in the proposed IPO of HDFC AMC.
As per draft red herring prospectus filed with capital market regulator on March 14, the 2,54,57,555 equity shares’ initial public offering consists of an offer for sale of up to 85,92,970 equity shares by HDFC and and up to 1,68,64,585 shares by Standard Life Investments.
HDFC AMC aims to raise Rs 2,787.60-2,800.33 crore through the public issue.
Technical Factors
The Nifty for the week ended July 20, 2018 formed Doji Cross kind of pattern.
The index is stuck between 10,923 and 11,078 zones from last eight trading sessions and requires a range breakout to commence the next leg of rally, experts said, adding the flat close on week on basis with a Doji candle which indicates a tug of war while decline is being bought in the market.
The underlying trend of Nifty is range bound. The uptrend status, post sharp upside breakout of last week is still intact. There is a possibility of further consolidation or minor weakness down to 10,850 levels in the next 1-2 weeks, HDFC Securities said in a report.
“Presence of strong support as per the concept of change in polarity at 10,850 levels is going to be a crucial, and one may expect emergence of sharp buying interest from the supports,” the brokerage house said in a report.
Rupee
The market could take note of the falling value of Indian currency. For the uninitiated, the currency fell to an all-time low of 69.12 to the dollar on Friday.
That initially dragged the market. A rally in heavyweights boosted the market. But if the trend continues in a similar manner, the Street could take a note of that as well.
Crude Oil:
After touching levels as high as USD 80 on the crude counter, prices have currently cooled off, giving a much-needed boost to the market’s rally in the recent past. But there has been some amount of bounceback by the commodity in the recent past.
Oil prices move decisively higher on Friday as the U.S. dollar fell after President Donald Trump accused China, Europe and others of manipulating their currency and renewed his criticism of the Federal Reserve for hiking interest rates. A weaker greenback typically supports oil prices because it makes crude, which is sold in dollars, more affordable to holders of other currencies.
Chinese import tariff:
The Street could make a note of US President Trump’s comments on Chinese imports and the likely tariff on them. As such, the markets have been rattled on the back of rising trade war tensions. Any such comments are likely to have not been taken positively by investors.
The US President has indicated that he is willing to slap tariffs on every Chinese good imported to the US should the need arise. “I’m ready to go to 500,” the president told CNBC’s Joe Kernen in an interview.
The reference is to the dollar amount of Chinese imports the US accepted in 2017 — USD 505.5 billion to be exact, compared to the $129.9 billion the US exported to China, according to Census Bureau data.
Stocks in news:
HDFC Bank: HDFC Bank Q1 net profit up 18.2%, asset quality stable
Havells India: The company’s Q1 standalone net profit at Rs 210 crore.
Wipro: The firm posted 16.3% QoQ rise in June quarter net profit to Rs 2,093.8 crore.
UPL: The company has announced acquisition of Arysta LifeScience in $4.2 billion all-cash deal.
L&T Finance and Holdings: Q1 profit jumps 71% to Rs 538 crore
MCX: Q1 net profit drops over 72 percent at Rs 7 crore.
Global Cues:
Investors will watch out for global data points. It could take a note of US existing home sales for June 2018, while Japan will come up with Nikkei Flash Manufacturing PMI for July 2018. The US flash manufacturing data will also be out during this month.
The European Central Bank will announce its decision on interest rates, while the initial jobless claims will also be out. Importantly, the GDP data for Q2 of 2018 will also be out. So, several data points will be in focus for D-Street to take a note of.
Corporate Action
Some of the stocks could be in focus for corporate actions such as bonus announcements, stock splits and dividend, among others.
So, the likes of Titan, Thermax, Ramco Cements, Blue Star, Graphite India, BASF India, and Britannia will all be in focus as they declare their dividend.
Macro Data
There’s not a lot of macro data points in India that will be in focus. But investors could still want to take a note of forex reserves data that will be out in the upcoming week as well.
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