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MARKET OUTLOOK FOR THE WEEK: 01-01-2017

MARKET OUTLOOK FOR THE WEEK: 01-01-2017
January 02
17:36 2017

Nifty closed above 8150 is positive and it is likely to move up towards 8245 and 8249.  If nifty manages to close above these two levels with volumes then we can expect further uptrend which can take nifty towards 8500 or even 8900 in the short term.  On the other hand support for nifty lies at 8043 and a decisive move below this could lead further fall in nifty and it may test panic bottom at 7903.  As the major investors are on staying sidelines due to Christmas and New Year do not expect smooth uptrend in the market.  Further more the India VIX is slightly moving up also suggesting volatility to continue in the recent days.  Global cues are slightly negative after the sharp rally in US equities markets, due to overbought situation.

Export oriented companies are going to benefit in the short run due to strong dollar index.  IT and pharma companies especially large cap stocks will be in focus next week. Rupee is facing selling pressure due to heavy FII liquidation of positions in the cash market.  Domestic institutional investors are supporting the market to a great extent.  We can expect the situation to continue.  Large IPO issue of national stock exchange will also drain the liquidity of the secondary market in the days to come.  Metal stocks are also expected to support the market after recent technical correction.  Metal index has support at 2594 and 2521.  It has resistances at 2720 and 2746.

Banking stocks are still weak but it is already entered into the oversold territory.  Banking Nifty has support at 18000 and 17672.  The immediate resistances are at 18328 and 18730.  Selective banking stocks may lend support to the market.

Manufacturing PMI, US FOMC minutes, continuing jobless claim, initial jobless claims, Market composite PMI, Market service PMI, Balalance of Trade, non-farm payroll, US unemployment rate and factory orders data’s are due next week.  From Euro side unemployment change, Market manufacturing PMI, inflation rate, unemployment change, consumer confidence, wholesale price YOY and Retail sales YOY are expected next week.  Indian data’s like Nikkei Manufacturing PMI, Foreign reserve, Industrial production, inflation rate and manufacturing PMI are due next week.

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ALEX MATHEWS

ALEX MATHEWS

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