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Nifty, and Sensex scaled fresh lifetime highs this week. Benchmark indices advanced for a third week in a row on a weekly basis. IT and Bank gained the most this week whereas Media and Realty dropped the most.

India’s WPI inflation remains in the negative territory for the 5th Straight month at -0.52% in August as compared to -1.36% in July. Core Inflation rate unchanged at -2.2%. India’s Retail inflation CPI in August eased to 6.83% from 7.44% in July as vegetable prices cooled. We expect RBI to remain cautious as inflation is still above the accepted limit, inflation could moderate further in the coming time if the current trend of food prices persists.

India’s Industrial output (IIP) grew by 5.7% in July from 3.8% in June.

Indian Automotive industry total sales in August was up by 3.6% at 19.45 lakh units from 18.7 lakh units YoY. As domestic sales went up, exports have come down. We expect demand to pick up during the festive season and the revival of monsoon after a deficit.

On the global front, US inflation posted its highest monthly increase this year in August to 3.7% led by the surge in gas costs. US PPI increased by 0.7% in August, the biggest monthly gain since June 2022 due to higher energy costs and a variety of other items. It indicated that the inflation would persist for a while. US initial jobless claims came at 2.20 lakh for the week ended September as compared to 2.17 lakh in the previous week. China's August industrial output rose 4.5% and retail sales rose 4.6%.

In the coming days market may react to some major macroeconomic data such as US S&P Global manufacturing and services PMI, Initial Jobless claims, building permits, crude oil inventories, Existing home sales, FOMC statement, Fed Interest Rate Decision, UK inflation, Eurozone inflation, forex reserves will be in focus.

Recently the NIFTY index has been on a bullish trajectory, breaking its all-time high and maintaining a strong momentum for the third consecutive week, resulting in a 2% rise this week. Notably, Nifty found solid support at 19800 and managed to increase by 2%, closing the week at 20192. The NIFTY prices have also consistently remained above their short-term moving averages, specifically the 21 and 55-week EMAs.

Meanwhile, Bank Nifty also performed well during the week, closing with a gain of over 2% and surpassing the previous week's closing price. It appears to have established a robust demand zone within the 45300-45500 range. Looking ahead, it's important to note that a resistance level is expected at 46300.