A bronze bull statue stands at the entrance to the Bombay Stock Exchange (BSE) in Mumbai, India. (Photographer: Dhiraj Singh/Bloomberg)

Weekly Wrap: Profit Booking Shrinks Sensex, Nifty Weekly Gains

Indian equity benchmarks extended gains for the fifth consecutive week, but only ended marginally higher as investors booked profits.

The S&P BSE Sensex and the NSE Nifty 50 gained 0.37 percent and 0.26 percent, respectively, to end the week at 38,164.61 and 11,456.90, respectively. This came after gains made by Larsen & Toubro Ltd. and Infosys Ltd. were pressured by losses in Reliance Industries Ltd. and HDFC Bank Ltd. Both the indices hit yearly highs in the week.

Weekly Wrap: Profit Booking Shrinks Sensex, Nifty Weekly Gains

The markets settled lower on Friday amid volatility and tracking mixed cues, Jayant Manglik, president of retail distribution at Religare Broking, said in a statement. He said that the initially upbeat markets declined as the week progressed. “Mostly sectoral indices traded weak in line with the benchmark index and the broader indices too remained under pressure.”

We may see further profit taking in the index and that could cascade on broader front, too. In case of decline, 10,350-10,250 zone would act as cushion.

Manglik suggested that traders should utilise any dip to accumulate quality stocks, considering the overall bullish trend. He preferred private banks, energy and select infrastructure stocks as he expects the automobile, metal and media pack to continue to underperform.

The Nifty is in the process of new higher top formation, Immediate supports to be watched at 11,410 levels, according to HDFC Securities’ Senior Technical and Derivative Analyst Nagaraj Shetti.

A long negative candle was formed on Friday at the new swing high of 11,572 levels, which signals a profit booking at the highs. We observe a positive sequential movements like higher tops and bottoms as per daily time frame chart.
Nagaraj Shetti, Senior Technical & Derivative Analyst At HDFC Securities

Shetti expects more weakness in the short term as Nifty is forming a higher top formation.

“A ‘doji’ or a high wave type candle pattern was formed in the Nifty as per weekly time frame chart,” he said. “The formation of such weekly pattern post-sharp up move of the previous week could signal a possibility of consolidation or minor downward correction for the next week. Immediate supports to be watched at 11,410 levels.”

A doji pattern is a small trading range with an opening and closing price that are virtually equal.

Broader Market Rally

The NSE Nifty 500 Index, too, rose for the fifth straight week to gain 0.1 percent, led by Prestige Estate Projects Ltd. and Godrej Properties Ltd.

Seven of the 11 sectoral gauges compiled by the National Stock Exchange advanced, led by the NSE Nifty Realty Index’s 6.38 percent gain.

Rupee Ends Higher For Fifth Week

The Indian rupee ended higher for the fifth straight week—its longest weekly streak since December 2017. The local currency appreciated 1.5 percent this week to close at 69.09 against the U.S. dollar, making it the best performer among Asian currencies during the period.

Big Talking Points This Week

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  • Modi to contest from Varanasi, Amit Shah from Gandhinagar
  • Top India official defends data revisions amid controversy.
  • U.S. jobless claims fall more than expected to four-week low.
  • India risks fresh bad-debt pile up as weak banks resume lending.
  • Mid-cap investors worried about elections can take heart from history.
  • Xi to visit Europe in bid to offset concerns, boost trade.
  • Russia ditches income data that has slumped for five years.
  • L&T to Mindtree – Your move next.
  • Mukesh Ambani bails younger brother Anil out of jail trouble.
  • GST Council clears transition plan for tax cut for real estate sector.
  • The era of mind-blowing MLB paydays could be coming to an end.
  • Startups caught in angel tax net also getting relief.
  • Google pushes into video games with Stadia service.

Don’t Forget:

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  • State-run banks need to up their game, says Arundhati Bhattacharya.
  • Ericsson teaches Anil Ambani – and India – a lesson.

Meanwhile, don’t forget to catch all the BQ Blue Exclusives here.

Key Events To Watch Next Week

  • March 29: Fiscal deficit data.
  • March 29: Eight infrastructure industries.