Benchmark indices had an outstanding week, marking their best performance in the last two months. The bullish trend continued for six consecutive sessions, boosting Market sentiment. As the new trading week begins, several key economic indicators are expected to influence market direction.

Market Drivers for the Upcoming Week

1. Economic Data: Market participants will closely monitor key economic data, including India’s Consumer Price Index (CPI), Wholesale Price Index (WPI) inflation, Industrial Production (IIP) numbers, and manufacturing output figures. These data points will provide insights into the health of the Indian economy and may steer market sentiment.

2. Monsoon Progress: With the monsoon gradually improving, there is optimism in the market. Adequate rainfall is crucial for the agricultural sector, and positive monsoon trends can boost rural income and consumption.

3. G20 Summit: India is hosting the G20 summit over the weekend, which can have positive spillover effects on the stock market. International events like this can enhance investor confidence and may propel the market towards its all-time high and the coveted 20,000 mark in the coming days.

Technical Analysis

Nifty Upside: Technical analysts are optimistic about Nifty‘s performance in the coming week. They anticipate Nifty reaching new all-time highs, potentially surpassing the 20,000 mark. The immediate upside target for Nifty lies in the range of 20,100 to 20,200.

Nifty Support: On the downside, immediate support for Nifty is placed at 19,650 levels, providing a cushion in case of any corrections.

Fear Gauge: The India VIX, often referred to as the fear gauge, fell by 0.85% to settle at 10.78 levels. This suggests a relatively lower level of fear in the markets, which can be conducive to positive market movements.

Global Market Snapshot

US Markets: The S&P 500 closed slightly higher but posted a weekly decline. Concerns about interest rates and anticipation of upcoming US inflation readings weighed on investor sentiment.

Asian Markets: Asian equities displayed mixed performance at the start of the week. Investors remained cautious, and the yen gained strength following potentially hawkish comments by the Bank of Japan governor.

Oil Prices: Oil prices softened in early Asian trade due to concerns about China‘s economic outlook affecting fuel demand. However, Brent crude remained above $90 per barrel, supported by supply cuts by Saudi Arabia and Russia.

Stocks in F&O Ban: Several stocks are in the Futures and Options (F&O) ban list. These include Indiabulls Housing Finance, Balrampur Chini Mills, PNB, Hindustan Copper, India Cements, Delta Corp, Manappuram, SAIL, and Chambel Fertilisers. Stocks enter the F&O ban period when they cross 95% of the market-wide position limit.

FII/DII Activity: Foreign portfolio investors were net sellers on Friday, offloading shares worth Rs 224 crore. In contrast, domestic institutional investors (DIIs) were net buyers, purchasing shares worth Rs 1,150 crore.

Rupee Performance: The Indian rupee reversed its four-day losing streak, closing 24 paise higher at 82.99 against the US dollar. A positive trend in domestic equities and suspected RBI intervention contributed to the rupee’s gains.

F&O Positioning: Foreign portfolio investors increased their net long position from Rs 21,939 crore to Rs 26,533 crore. This reflects growing optimism among foreign investors in the Indian market.

As the new trading week unfolds, these factors will be pivotal in shaping market dynamics and investor sentiment. Traders and investors will be closely monitoring economic data releases and global developments for cues on market direction.

Disclaimer: The information provided here is for educational purposes only and should not be considered financial advice. Always conduct thorough research and consider consulting a financial professional before engaging in algorithmic trading.

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