Domestic bourses outperformed its Asian peers and surged nearly 1.2 percent during the week primarily led by the strong gains in Banking, IT and Auto stocks. Stellar benchmark gains were primarily supported by the gains in stocks like Kotak Bank, HDFC Bank and ITC.
Wall Street sentiments remained cautious during the week following Fed tapering woes, virus-led economic fears and corporate tax rate hikes, while weak Chinese data weighed on global sentiments.
Despite all the global negativity, Nifty 50 index outperformed amid sharp rally in heavyweight banking stocks as government announced Rs 30,600 crore of government guarantee for bad bank.
Further, relief to telecom players on outstanding AGR dues also boosted sentiments. Auto index gained traction during the week as cabinet approved Rs 26,058 crore PLI scheme for auto, auto components and drone industry.
Going ahead, Investors will closely monitor US Fed meeting outcome which is scheduled next week to take cues on taper plans along with Covid-19 situation and economic data that will also stay on investors’ radar.
From a technical standpoint, Nifty rallied over 500 points or nearly 1.34 percent to maintain its winning streak and set its new record high at 17,792.65 while Bank Nifty rallied over 1100 points during the week to set up a fresh lifetime high of 38,112 gaining’s above 3 percent during the week.
On the sectoral front, the Nifty Media outperformed in all the sectors by gaining over 13 percent while PSU banks rallied nearly 5 percent and on the losing side, the Realty and Metal sectors ended in the red zone.
Technically, both benchmark indices settled above the 20-days Moving Average as well as above the Parabolic Sar, indicating further strength. Also, both the index settled above the convergence line as well as above the bullish clouds of the Ichimoku Indicator, which indicates a further north journey. At present, Nifty has its crucial support at 17,250 levels while BankNifty has support at 37,100 while resistance lies at 17,800 and 38,300 respectively.
Weekly top gainers and losers
Sharp rally was seen in banking stocks like Indusind Bank and Kotak Bank as government announced government guarantee for bad bank. Relief to telecom players on outstanding AGR dues also boosted sentiments of banking stocks.
Telecom stocks jump during the week following central govts announcement on AGR moratorium. Bharti Airtel stock surged over 6 percent in one week on improved business outlook.
ITC shares spike on expectation of improvement in business outlook. Investors cheers on possible restructuring plan next month.
BPCL stock falls as ex-dividend date arrives.
(Ankit Pareek is Research Analyst, Choice Broking)