Weekly Wrap: Volatile Crude, Poor Monsoon Hurt Investors For Third Straight Week
Indian equity benchmarks extended their decline for the third straight week.
Indian equity benchmarks declined for the third straight week as poor onset of monsoon and volatile crude prices added to uncertainty caused by slowing economic growth.
The S&P BSE Sensex closed 0.65 percent lower this week at 39,194.49 and the NSE Nifty 50 closed at 11,724.10, down 0.84 percent.
Hemang Jani, head (advisory) at Sharekhan by BNP Paribas, said in a statement that these factors have dampened investor sentiment. “The upcoming union budget will be the key event in the market.”
“Amid uncertainty, investors should maintain a stock-specific approach and focus on stocks with quality management and relatively strong balance sheet,” Jani said.
“The Nifty is continuing its corrective fall with intermittent rallies which is later met by declines,” Jimeet Modi, founder and chief executive officer at SAMCO Securities & StockNote, said in a statement. “Once 11,600 is broken, the next likely support point would be 11400, which is also the gap that should get filled for the markets to again begin a healthy rally.”
Time cycle correction suggests the budget could be a turning point for the markets which would coincide for the market taking support at the lower trend channel. Avoid trading in this corrective market.Jimeet Modi, Founder & CEO, SAMCO Securities & StockNote
How The Broader Markets Performed
The broader market index represented by the NSE Nifty 500 Index closed 0.91 percent lower this week. The declines were led by the fall in Jain Irrigation Systems, Reliance Home Finance and Graphite India.
Eight out of 11 sectoral gauges compiled by NSE ended lower this week, led by the Nifty Pharma Index’s 2.13 percent gain. On the flipside, the Nifty Realty Index was the top sectoral performer up 1.27 percent.
How Money Market Performed
The Indian rupee strengthened this week amid rising crude oil prices. The home currency appreciated 0.32 percent this week to close at 69.57 against the greenback. Besides, all its Asian peers strengthened this week against the U.S. dollar.
Big Talking Points Of The Week
- Budget airline IndiGo orders 280 jet engines in $20 billion deal.
- Yes Bank plans to raise $1.2 billion to boost capital, CEO says.
- Piramal Enterprises sells entire stake in Shriram Transport.
- GST Law permits arrest without FIR or anticipatory bail, says Supreme Court.
- Air passenger growth rebounds in May.
- Dr. Reddy’s continues to exit non-core businesses.
- Facebook wants its cryptocurrency to one day rival the greenback.
- HDFC ERGO-Apollo Munich merger to create India’s second largest private health insurance firm.
- PM’s Economic Advisory Council versus Arvind Subramanian: The GDP debate continues.
- Om Birla is new Lok Sabha speaker.
- Jet Airways admitted to insolvency by NCLT.
- India may raise income tax threshold in budget to revive economy.
- The $84-billion dilemma vexing India’s three telecom tycoons.
Key Events To Watch Next Week
- June 28: India Fiscal Deficit data for may
- June 28: IIP data for May