Market Outlook this week

We understand the need for the right research to make smart investment decisions. To keep you well informed, we present the market outlook for this week.

Previous Week : BSE Sensex closed at 19732 up by 462 points, while the NSE Nifty closed at 5850, up by 170 points

Equity benchmarks extended gains for third week in a row and closed at a six week high buoyed by a strengthening rupee and receding concerns of a US led military strike on Syria. Investor's sentiments are also boosted by better than expected trade deficit numbers of the month of August. IIP data, after contracting for two consecutive months entered the positive zone in July, recording a growth of 2.6 per cent on account of improved performance of manufacturing and power sectors The August CPI inflation came in at 9.52% vis-a-vis last month's data of 9.64% ACC, Axis Bank, Bank of Baroda, Punjab National Bank, HDFC, L&T, ITC, Tata Motors and Sun Pharma were the major gainers in the index amongst Nifty constituents

Week Ahead : Domestic market to look for WPI August data and 1st monetory policy

The price action on the weekly time interval charts formed a strong bullish candle and it carries a 58 point bullish gap below its base between 5738-5680 levels. Nifty started the week with a gap up above its 200 day EMA (5735) and carried on with the positive momentum for the rest of the session as the index registered its biggest single day gain in absolute terms since May 2009 on 10th September 2013. Nifty traded the rest of the week in a 110 points range with high volatility. Weakness below last three days low (5815) will lead to intensified profit bookings and see the index heading to fill 10th Sep 2013 bullish gap up area placed between 5738 and 5680 levels in the coming week Nifty on the higher side will face stiff resistance from the downward sloping trendline formed by connecting the highs of May 2013 (6229) and July 2013 (6093) is placed around 5980 odd levels This also coincides with the 80% retracement of the entire decline from July 2013 high of 6093 to August low of 5118 is placed around 5950 We would therefore advocate for a cautious approach as the index approaches its key overhead resistance area in the coming sessions The upcoming week will see a slew of events lined up almost every day. Therefore we expect the volatility to remain elevated in the markets in the upcoming week Week starts with WPI data (August) on Monday, followed by US Federal reserve FOMC rate decision on Wednesday 18th September 2013 and then RBIs monetary policy on Friday 20th September 2013 In the next week the domestic markets would be looking out for WPI data (August) and first monetary policy from the new governor The US markets would be looking for FOMC rate decision The important data releases would be the Industrial production, CPI, MBA mortgage applications, Initial jobless claims and Continuing claims.