D-Street In Love With Volatility, Expect Range-Bound Markets Ahead

Our Analysis

The week started on a cheerful note as in absence of the domestic trigger the D-street was tracing the global cues, the comment of Us President Trump on delaying the increase in the tariff of the Chinese goods boosted the sentiments of the investors, but border tension between India & Pakistan played a spoilsport, The correction in the market was not too sharp but certainly the volatility has been quite high as the VIX went just above the 19 Level.

The February month series ended on the negative note with loss of about 42 points after witnessing huge volatility in the month, Nifty closed just one point higher compared to the previous week. The overall sideways action continued for the 15th week.

Nifty most likely to move within the range next week too unless there is any further escalation in the Indo-Pakistan tension, Globally all eyes will be on the outcome of the second summit between Kim & Trump, Also the development on the Brexit front will keep the investor on their toes. Nevertheless, We have seen a solid buying from foreign portfolio investors, going forward that can bring a positive sentiment to the domestic investor too.

This Weeks Market Highlights:

Benchmark Indices:

1) On Monday, Bulls took the control with the Nifty and Sensex finished nearly 1 percent higher, The Sensex was up 341.90 points at 36213.38, while Nifty was up 88.40 points at 10,880.10.

2)Among Sector compiled by NSE advanced, led by the Nifty Private Bank Index's 1.1 percent gain. While, the Nifty realty Index was the top sectoral loser, down 0.7 percent.

3)On Tuesday, Indian equity benchmarks ended lower, The Sensex was down 239.67 points at 35973.71, while Nifty was down 44.80 points at 10835.30.

4)On Wednesday, Indian equity benchmarks ended lower for the second day, as the market remained volatile throughout the day amid tension between India and Pakistan.
5) the Sensex was down 68.28 points at 35905.43, while Nifty was down 28.60 points at 10806.70. Among Sector compiled by NSE ended lower, led by the Nifty Media Index 0.88 percent decline. While, the Nifty PSU Bank Index was the top sectoral gainer, up 0.52 percent.
6) On Thursday, Indian equity benchmarks ended lower on the F&O Expiry day. The Sensex was down 37.99 points at 35867.44, while Nifty was down 8.90 points at 10797.80.
7) On Friday, Benchmark indices started on a strong note after three-day fall.

Broader Index & Global Market:

- Globally, Wall Street was trading cautiously on the back of a host of events, Fed chairman reiterated that the fed will remain patient in determining the further adjustment to interest rate, given the uncertainty over the economic outlook.The optimism surrounding the US-China trade relations was seen fading as Us diplomat suggesting there was still more work to be done.

- In the broader market, The Mid-cap and Small-cap has outperformed the benchmark indices, we have witnessed a good buying interest from the investor in the broader market as compared to benchmark indices, the same can continue going forward.

Movers & Shakers

Shares of the Allahabad bank surged more than 8 percent in a week after RBI removed allahabad bank from its so-called prompt corrective action (PCA) list, the bank has also reduced the marginal cost-based lending rate by 10 basis points covering maturities effective from March 1.

Key Market Drivers

• The government cut the tax rate on under construction and affordable housing to boost the real estate sector and ease the financial burden on home buyers. The GST Council Sunday decided to cut GST rate on affordable homes to 1% without input tax credit (ITC) from earlier 8 % with ITC.
• There would be a delay in the plan on increasing Chinese imports as the trade talks between the two sides are making substantial progress, US President Donald Trump confirmed.
• The GST on the under-construction flats, which were not under the affordable housing segment, has been reduced to 5 % and without ITC from 12 % earlier with ITC
• NCLATs two-judge bench led by Justice S J Mukhopadhaya announced that no financial institution will declare the accounts of IL&FS including the amber companies as an NPA without prior permission of NCLAT.
• Over 300 terrorists eliminated in IAF's covert operation.
• Reserve bank of India had removed Allahabad Bank, Corporation Bank, Dhanlaxmi Bank from the prompt corrective action (PCA) framework.
• The Centre's fiscal deficit in the first ten months of the current fiscal stood at Rs 7.71 lakh crore or 121.5% of the full-year target (revised estimate), as there is slower-than-projected growth in tax receipts, according to data released by the Controller General of Accounts on Tuesday.
• China's official Purchasing Managers Index (PMI) fell to 49.2 in February, data showed on Thursday, the weakest level since February 2016.
• RBI & Bank of Japan had completed the signing of $75 bn currency swap pact.
• Indias GDP growth slips to 6.6% in Q3 against 7.7 percent a year ago.GDP growth slips to 6.6% in Q3 against 7.7 percent a year ago.

Event Watch

International:

• Caixin China PMI Mfg
• US trade balance
• China trade balance
• Japan GDP
• US-China trade talk

Domestic:

• Nikkei India PMI services.
• India-Pakistan border development.
• Monthly Auto sales Number

Stocks To Watch

Grasim, kajaria ceramic On Upside while Cipla on Downside.