After eight weeks of despair and relentless selling, the Nifty bulls managed to defy odds and register a green weekly candle on the charts, even if it was for just 100 points. Two key takeaways came from last week’s topsy turvy action – One – 22,000 is a very very important level on the downside for the index, and Two – the slightest miss on numbers will get punished as there are expectations this time around for decent growth contrary to the first quarter, when there were no such expectations.
Another important week beckons for the Indian markets as not only do we report key macro data, but earnings season picks up pace as well. Macro data and important results will be reported from Wall Street as well during the course of the week.
FAQs
What Are The Important Triggers For The Week For Indian Equities?
During the course of the week, Indian markets will first be tracking inflation data that will be reported both on the consumer and wholesale prices on Monday and Wednesday. That will be a key metric to track to determine what would be the RBI’s Monetary Policy trajectory going forward, after the 25 basis points hike last week. The data is particularly important, considering the drought situation in many parts of the country due to the sub-par Monsoon. Earnings season also picks up pace during the course of the week, with over 70 companies coming out with their September quarter results. A clutch of major banks – HDFC Bank, Axis Bank, ICICI Bank, Yes Bank, RBL Bank, will all be reporting numbers during the week, while IT majors like HCLTech, Tech Mahindra and Wipro also come out with numbers. Apart from these, many other broader market companies such as Polycab, BHEL, Persistent Systems, Tata Elxsi and others will also be reporting numbers this week.
What Are The Key Nifty Levels To Watch?
The Nifty is currently stuck in a broad range. Friday’s close above the 22,500 mark will give the bulls some hope that the bounce will sustain going into the next week as well. On the downside, the 2026 low of 22,181 that the index made last week will be key to watch, as a break below that would again make the index vulnerable for a fall towards the 22,000 mark and maybe even below that. On the upside, in case the index does manage to sustain above 22,500 this week, the next levels would be around 22,700 – 22,800, as that is where supply emerged during the course of last week as well.
What About The Nifty Bank Next Week?
The Nifty Bank emerged as the stronger one among the two indices during last week as it had a positive reaction after the RBI rate hike and their change in stance. However, there have been more announcements made by the RBI over the course of the weekend, with regards to hiking the minimum daily maintenance of the Cash Reserve Ratio (CRR) of banks to 99% from 90% from the fortnight that begins on October 16. It remains to be seen how the banking stocks and subsequently, the Nifty Bank react to this announcement. The Nifty Bank closing above the 55,000 mark last week is indeed a positive, whether that will sustain or not is the big question. Of course, major banks are coming out with results next week, but that reaction will only be seen next Monday, as the results will be reported on Satuday. On the downside, the 54,500 level can prove to be an important support zone as the index defended that mark for most of last week.
Are There Triggers For Indian Markets Beyond Earnings and Macros?
Yes. Beyond the results and macros, Geopolitics continues to remain a key trigger. How oil prices react to the Russia-US diesel deal will be important. In case prices do fall, it will be a positive for the Indian markets. Bond yields cooled off last week from two-decade-high levels. In case they cool further watching any potential fall in oil prices, that will be viewed as a positive too. Inflation data will also be reported in the US this week, and that could provide cues on whether the Fed will indeed go ahead with one more rate hike this year, as is the projection. For now, the general consensus is that an October hike is off the table, but one in December is in store, making the inflation print important to watch. Major banks on Wall Street will also be reporting results during the course of the week, and while they do not have any direct bearing on our markets, they do happen to be clients for some of our IT services companies.
Should You Buy Or Sell The Nifty On Monday?
Amol Athawale of Kotak Neo believes that the market is still holding on to the lower tops, lower bottoms structure, which is largely negative but since the conditions are oversold, a bounce cannot be ruled out. 22,400 on the Nifty is an important support, according to him, and he expects the index to rebound towards 22,800 levels, breaking above which, even 23,000 is possible. However, a break below 22,400 can lead to the Nifty retesting the recent lows. Rupak De of LKP Securities said that the Nifty needs to cross the 50-EMA mark of 22,600 – 22,650 and sustain above it to ensure that the recovery seen on Friday continues further. However, a failure to hold on to that zone could lead to the index heading back to the weakness zone. 22,450, 22,350 and 22,100 are important supports on the downside.