On Friday, profit-booking took the lead, causing India’s main stock indices, the Nifty 50 and Sensex, to drop from their early gains and stay in negative territory for the rest of the day.
The market performance was more favourable to sellers, with only 18 of the Nifty 50 stocks gaining, while 32 fell. However, the Nifty MidCap 50 index managed to end slightly above the breakeven point.
A positive sign was that the India VIX, a measure of market volatility, continued to decline, falling by 1.27% to 13.
What to Watch for Next Week
According to Arvinder Singh Nanda, Senior Vice President at Master Capital Services, upcoming domestic and international economic data will be crucial. Key reports to watch include:
- Core PCE Price Index (YoY) for May
- US GDP (QoQ) for Q1
- Initial Jobless Claims in the US
- UK GDP (YoY and QoQ)
- India Infrastructure Output (YoY) for May
Market Outlook from Dharmesh Shah, ICICI Securities
The market had a quiet week, with the index showing minimal movement and forming a high-wave candle pattern, indicating increased volatility but stable stock-specific actions.
Key Points:
- Sector Rotation: Continuous shifts among different sectors and an improved market breadth signal underlying strength in the market. This supports the expectation that the Nifty 50 could gradually move towards 23,800 in the coming weeks.
- Buying Opportunity: The index is currently undergoing a time-wise correction after an 11% rally post-election, making it a good time for incremental buying opportunities. Strong support is at the 23,000 level.
- Bank Nifty’s Role: The Banking sector, which makes up about 35% of the Nifty 50, has seen revived activity. This is likely to push the Nifty 50 higher.
- Global Market Trends: With global markets generally trending upwards, significant volatility is unlikely.
The structural pattern of higher peaks and troughs indicates strong buying demand, reinforcing support at 23,000, which aligns with the 20-day EMA.
Bank Nifty Outlook
The Bank Nifty index has hit a new lifetime high and is expected to continue its upward trend, potentially reaching 53,000 in the coming weeks, with 49,900 acting as key support.
Top Stock Recommendations by Dharmesh Shah
- Buy GAIL Ltd:
- Buy Range: ₹208-216
- Target: ₹240
- Stop Loss: ₹196
- Buy Kajaria Ceramics Ltd:
- Buy Range: ₹1,315-1,350
- Target: ₹1,495
- Stop Loss: ₹1,220
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