Market Bullish Despite The GDP Shock

Market This Week

This week the market started to gain momentum but with slow speed as nifty has a strong support level at 9690. A huge buying was seen in Metals, Oil, and Auto sector stocks. The GDP numbers for the first quarter came to 5.7% compared to 6.1% in the previous quarter and 7.9% in same quarter last year. This number is same to three-year low level but the number is under pressure because of GST implementation and reduced pace of growth in manufacturing and service sector. However, the long-term investor need not worry about it as growth will pick-up in coming quarters as the market is still in the bullish mode.

On the geopolitical front, the tension between North Korea and the USA still poses a question mark as for whether a war will happen or not but the UN is trying to resolve the problem via the diplomatic route.

Movers & Shakers

Bombay Dyeing rallied almost 50% this week due to the outstanding numbers presented by the company on yearly basis. Future market networks gained over 40% because of outstanding numbers presented by the company for 1st quarter and positive management commentary. Vardhman holdings rallied 15% this week as the price was at a strong support level in a strong uptrend. TV Vision, Sri Adhikari brothers as well as Religare Enterprises tanked 20 to 30 % because the price has broken major support level.

Key Market Drivers

Apart from the missile launched by North Korea over Japan in start of this week and GDP numbers presented by CSO the other crucial news for market are 1) Government is planning to revise industrial and manufacturing policies (i.e. the manufacturing policy of 2009 and industrial policy of 2011) according to new challenges of Industrial Revolution 4.0, Make In India and improvement taking place in the industries in the world. 2) Indian government presented the next edition of consolidated FDI policy document, incorporating all the changes made since the past one year which is investor friendly and easy to understand. 3) The government has made PAN card mandatory for all transactions of buying gold and not just those above Rs. 2 lakh.

Event Watch

Consumer Price Index (CPI) and Wholesale Price Index (WPI) inflation numbers are coming on 12th and 14th of this months respectively. The situation in North Korea is crucial to follow as the situation is tensed after North Korea fired a missile over Japan.

Stocks to Watch

KEI Industries Ltd is on the upside while Religare Enterprises Ltd is on the downside.