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Benchmark Indices hits fresh record high after a volatile week amid strong third quarter GDP and positive overnight global cues boosting investors sentiments. Nifty made a life time high of 22,353.30 points and Sensex hit 73,819.21 points. Nifty, Sensex and Bank Nifty gained for 3rd straight week. On the sectoral front, all sectoral indices ended higher except Media, Pharma and IT.

On the domestic front, India’s Fiscal Deficit for April-Jan widens to Rs 11.03lk cr from Rs 9.82 lk cr in April-Dec, 63.6% of FY24 Estimate. India’s Eight core sector growth in Jan is at 3.6% lowest in hits 15-month due to five out of eight sectors output saw either contraction of growth at a slower pace. India’s Manufacturing PMI rises to highest in 5 months to 56.9 in Feb indicating strong production growth supported by both domestic and international demand.

India’s GDP growth for Q3 accelerated to 8.4% retaining its position as the fastest growing economy in the world, displaying strength and potential of the Indian economy. The growth in GDP was supported by double digit growth in manufacturing, robust growth in construction sector and high domestic demand. Going Forward, it is expected that India will maintain its position as one of the fastest growing economies in the world but in the near term, some moderation could be seen due to impact of inflation, geopolitical situation and Red Sea crisis.

On the Global front, US GDP grows 3.2% in Q4. It is expected that the growth will remain positive but at a slower pace in the coming quarters. China Manufacturing PMI shrinks to came at 49.1 in Feb in line with the estimates. China is witnessing weak local demand along with muted export demand. While the Non- manufacturing PMI grew to 51.4 in Feb amid Lunar New Year Holiday supported demand for services due to increased retail spending and travel.

As the Indian market is achieving record highs, primary market is also very active as many mainboard and SME IPOs are keeping the investors busy and many are in the Pipeline. India’s economic growth outlook, improved corporate earnings and strong demand from both domestic and foreign investors are providing a tailwind to the Primary market. In Jan 21 IPOs raised about $678mn as compared to $17mn last year. This has led India to become seventh largest stock market in the world overtaking Hong Kong. In the coming time period the strong flow of IPO is expected to continue in India.

In the coming week market will react to the global and domestic economic data, FII/DII investment pattern, crude oil inventories, movement of rupee against dollar, trend in global stock market. Some major economic data which could impact the market are China’s Caixin Services PMI, Inflation numbers, Trade Balance, India’s S&P Global Services PMI, Forex Reserves, UK S&P Global/CIPS Services PMI and Construction PMI, US S&P Global Services PMI, ISM Non-Manufacturing PMI, API Weekly Crude Oil Stock, ADP Nonfarm Employment Change, Crude Oil Inventories, Initial Jobless Claims, Unemployment Rate.

The Indian equity indices witnessed a volatile week, ultimately extending their winning streak for a third consecutive week to achieve a new all-time high. The Nifty and Bank Nifty indices rose by nearly 0.75% and 1.0% respectively, closing the week at 22378.4 and 47297.50. Initially, the Nifty prices dropped to as low as 21860.65, the lowest level since February 15. However, bargain hunting emerged from these lower levels, driven by several positive fundamental factors. These include India's GDP growth for the third quarter of the fiscal year 2023-24, which exceeded expectations at 8.4% compared to the estimated 6.7%, as well as a resurgence of buying interest from FIIs which injected nearly Rs. 23.4 crores into the cash segment. Additionally, the backdrop of an improving global market and a respite in the U.S. PCE inflation reading provided further support to the market.

In Nifty, in the short term, the index can move towards 22,550 and a move above it can take it to 22,700. Support on the lower end is placed at 22100, while strong support anticipated in the range of 21750-21800. Both price and momentum indicator is suggesting continuation of the positive price action. On the upside immediate hurdle is placed at 22,450 – 22,500.
 

In Bank Nifty, the prices have rebounded from lower band of rising channel pattern and moving towards upper band. Once sustained above 47500 there are strong chances that the index is poised to surpass its all-time high of 48,500 marks in the near term. The current support for the index is established in the range of

47,000-46,900, and any pullback towards this support zone is seen as a favourable buying opportunity

 

 

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