Markets Stepping Back To Gallop 12000 Mark

Our Analysis

Once again Nifty breached the 12,000 mark, however, failed to hold on it. The heavyweight Reliance trading at all-time high kept the bullish momentum intact for the benchmark. Along with that, the pharma stocks outperformed during the week which suggests the bottom out for the pharma sector after a prolonged correction.

This week, the buzz was created by the announcement of the cabinet, which addressed the key issues of the economy. The strategic sale in the 5 PSUs, targeting 1.5 lakh crores to address fiscal deficit is expected to drive markets in the near term.

Further, a 2-year moratorium on the spectrum payment due would provide great relief to stressed telecom companies. Moreover, the likely tariff increase by the telecom companies is expected to bring stability in the sector.

On the technical front, Nifty seems indecisive right now. Currently, the broader range of 11,800-12000 is respected by the market. With bullish sentiments, the strength for breaking the 12000 levels and holding on to it remains the key to step up to new highs. In our view, keeping a close eye and staying on the toes to enter would be beneficial in the near term.

This Weeks Market Highlights:

Benchmark Indices:

1) On Monday, the benchmark indices ended marginally lower with Nifty failed to hold above 11,900. At close, the Sensex declined by 72.50 points at 40284.19, while Nifty fall by 11 points at 11,884.50. Among sectors, metal, pharma, PSU bank, infra witnessed buying, while auto and FMCG were down.

2) On Tuesday, the market turned positive from telecom stocks supported by tariff hike plans. In Closing, Sensex was up 185.51 points at 40,469.70, while Nifty grew by 55.60 points at 11,940.10.

3)On Wednesday, Bulls managed to breach 12,000 decisively, however, it could not manage to close above the 12,000 marks. Some mild profit booking was still witnessing above the 12,000 marks. However, the overall structure remains positive and the rally is getting broad-based overall. In close, the Sensex was up 181.94 points at 40651.64, while Nifty was up 59 points at 11999.10.

4) On Thursday, the benchmark Sensex declined 76.47 points, or 0.19 percent, to 40,575.17, while the Nifty ended down by 30.70 points, or 0.26 percent, at 11,968.40.

5) On Friday, It is a negative start for the Indian indices with Nifty around 11,950 levels.

Broader Index & Global Market:

-Globally, the wall-street is making new highs over the optimism of the US-China trade deal, along with strong earnings and the revival in a slowdown in 2020 surges the Us-Market.

-The broader pack had been trading positive in this week. The Mid & Small-cap continued to remain strong compared with the benchmark. Specifically, the pharma, Metal, PSU would be the leader in the coming days..

Movers & Shakers

Shares of VODAFONE IDEA surged more than 44 percent after the government announced the 2-year moratorium on the spectrum payment due. Along with that, the announcement of the tariff increase by the telecom companies played well.

Shares of RELIANCE HOME FIN dropped more than 17.5 percent in a week after National Housing Bank has imposed a fine of Rs 45,000 on Anil Ambani group company Reliance Home Finance for violating certain rules.

Key Market Drivers

• Without a China trade deal, the U.S. will hike tariffs: Trump
• Sebi issues directions on margins collection in the cash segment.
• India-focussed offshore funds see the withdrawal of $1.4 bn in Q2.
• Govt mulls raising insurance cover on bank deposits.
• India's October trade deficit narrows to $11.01 billion.
• Govt intends to address concerns of the telecom sector.

Event Watch

International:

• China Industrial Profits
• US GDP Price Index

Domestic:

• Crude price
• INR Price
• India GDP Y

Stocks To Watch

SAIL & MAGMA FIN CORP On Upside while, SIEMENS & BATA on Downside.