Mitesh_Nifty

Welcome to the weekly blog on Indian Equity Markets •  It was mentioned in the previous week that a close below 16250 on Nifty50 will bring strong weakness.  The markets had closed below 16200 last Friday and  the low on the Index this week was 15186 which is a fall of almost 1000 points.  Officially starting a bearish trajectory on the Indian Markets. The FED Rate Hike • The US FED hiked the Interest rates by  75 bps a single largest hike since 1994.  There was a further commentary that a rate hike of another  75 bps can come by July 2022.   • The US Fed remains strongly committed in returning the inflation to 2% and hence further tightening of rates is seen. Impact of Rate Hikes globally • Increase of 50bps rate by Indian  RBI  in the previous week the highest in a decade. • Increase of 75bps rate by  US Fed  this week the highest in almost 2 decades. • Increase of rate hikes in the  UK  for the 5th consecutive time...

  As stated in the earlier week. Nifty had a very strong resistance at 16800. The markets remained suppressed and nifty only scaled upto 16600 on the upside. Also it was informed that a bearish trajectory will start below 16250. Unfortunately the markets have closed at 16200 and that is signaling a strong weakness in the coming time. The RBI Event The RBI raised the RepoRate by 50bps.  This is one of the highest single policy increase in a decade .  Such rate hikes are done to bring down inflation and inflation is at multi decade highs in India and other parts of the world. Increase in repo rates usually increases fixed income returns thus causing an outflow from Equity Markets towards fixed income products. Hence markets will remain suppressed in the near future. The RBI governor has given a cautious stance on account of global factors accelerated by War and Inflation.  There is anticipation of more aggressive rate hikes in the current calendar year, another reason ...

As stated earlier last week if Nifty holds 16450 market will be positive and upside range was mentioned till 16800.  This week markets gapped up above 16450 and the weekly high which was today was at 16800 dot after which we saw a sharp sell off. Nifty was supported by RELIANCE majorly and IT SECTOR. RELIANCE has been rising on account of strong International GRM and IT sector was a bounce from the oversold zone.  Bank Nifty has underperformed all through the week. With no participation in the rally. Fertiliser stocks have underperformed. There are talks of Fertilizer imports from Egypt in exchange of Wheat Exports from India. This may cause pressure on Indian Fertiliser Stocks  Cement Sector has gone down because of Capex plans of Ultratech and price war anticipation due to entry of Adani and over supply due to Capex increases. and approaching monsoon which will bring muted demands.  Auto Sector is facing resistance from upper levels. Auto numbers looked priced in f...