Finblab Research: Indian Stock Market Weekly Analysis

Poor week as far as Indian Stock Market is concern!

Only two factors that twizzle the Indian Stock Markets all through the week are (1) the higher Crude Oil price and (2) question mark over the Government formation in the state of Karnataka.

The BSE Sensex lost 688 points whiles the NSE Nifty lost 210 points on a weekly basis as compared to previous week. Here is an Indian Stock Market Weekly Analysis (14 May 2018 to 18 May 2018) by Finblab.

14-MAY-2018

• Range-bound trading session at the Indian Stock Market ahead of Karnataka election outcomes!
• After closing firm on the last trading session (290 points up on the Sensex and 90 points up on the Nifty on 11 May) the Indian Stock Markets today, as expected, remained range-bound all through the day and ended on a flat note as caution prevailed ahead of Karnataka election results due tomorrow.
• The major reason that triggers the markets to remain range bound till the last minute of the session was the Exit Polls results which anticipated hung assembly in Karnataka.
• The 30-share BSE Sensex today gained 21 points to close at 35,557 and the 50-share NSE Nifty rose 0.10 points to close at 10,807.
• Hindustan Unilever (HUL), India’s biggest consumer goods company, has presented it Q4 numbers on Monday after market hours. The company reported a 14.2% year-on-year rise in net profit to INR 1,351 Cr for the quarter ended March 2018 due to higher sales in its home care business. Revenue from operations for the quarter came in at INR 9,097 Cr compared with INR 8,906 Cr in the same quarter last year.

15-MAY-2018

• A day of high volatility at the Indian Stock Market!
• Opening firm in the morning session (up by more than 300 points) backed by the early polls showing BJP’s clear majority in the Karnataka election, the market couldn’t sustained gain and fell severely from its day’s high in the late half of the day and ended flat amidst uncertainty over formation of the government in Karnataka after election results.
• BJP in the Karnataka election has emerged as the single largest party after winning 104 seats (but was away from the clear majority) while Congress wins 78 seats and JD(S) wins 38 seats at the end of the day.
• Markets, in a situation like this, will be clearly in a wait and watch mood and see who will and how to form the Government in the state of Karnataka.
• The BSE Sensex today slipped 437 points from day’s high to end 13 points down at 35,544 while the NSE Nifty down 5 points to close at 10,802.
• Shares of Punjab National Bank (PNB) ended 12% lower at INR 75.55 from the previous close on the back of a weak set of numbers for the quarter ended March 2018. The company has reported a net loss of INR 13,416.91 Cr while the profit was dragged by 3 folds due to a surge in provisions towards bad loans. The banks total net worth fell below the amount of non-performing loans.
• D-Mart today rallied 4% as the stock will now be the part of MSCI (Morgan Stanley Capital International) India Index with effect from June 1.

16-MAY-2018

• A volatile session at the Indian Stock Market today!
• The Markets today opened on a week note today backed by a couple of bad news from the overseas front (like, North Korea refuses to join US summit and the Crude oil prices which touched at 3 and half years highs, 79 USD a barrel) and domestic news (like, uncertainty over Karnataka state that who will form the Government and PNB and RCom issue)
• The markets today witness a heavy loss in the early trade, but recovered half of its losses at the end of closing. The BSE Sensex today was down by 156 points and closed at 35,388 while the NSE Nifty fell 61 points to close at 10,741.
• Cigarette-to-soap maker ITC today announced its Q4 results today. The Company reported 9.9% year-on-year increase in net profit at INR 2,933 Cr for the 4th quarter of FY18, On a comparable basis, gross sales value of the Company stood at INR 67,081.92 Cr, reporting a growth of 4.5% driven mainly by the education and stationery products, the branded packaged foods, and personal care products.

17-MAY-2018

• Weak trading session at the Indian Stock Market!
• The Indian Stock Markets extended losses for the 3rd consecutive day on Thursday backed by the higher Crude oil prices (trading 80 USD a barrel now) and the tricky situation at Karnataka that who will form the Government.
• The macro data can be badly affected by the higher crude oil prices going forward and the markets seem to be worried more about that at this moment.
• The BSE Sensex was down 239 points to close at 35,149 while the NSE Nifty closed below the 10,700 levels, down 58 points at 10,683.
• Bajaj Finance – a leading NBFC announced its Q4 numbers today. The Company reported a 60.5% year-on-year growth in net profit at INR 720.95 Cr on the back of strong interest income and lower provisions due to improvement in bad loans. Net interest income (NII) for the quarter increased to INR 2,365 Cr, up 40% year-on-year from INR 1,686 Cr. Assets under management (AUM) of the Company increased by 33.6% year-on-year to INR 80,444 Cr.

18-MAY-2018

• Poor trading session at the Dalal Street!
• The Indian Stock Markets witnessed heavy selling pressure yet again for the fourth consecutive day on the back of continued uncertainty over the formation of government in the state of Karnataka.
• The 30-share BSE Sensex today falling 301 points and closed at 34,848 while the 50-share NSE Nifty down 86 points to close at 10,596.

Indian Stock Market Weekly Analysis – A Week Gone By

Future Outlook –

The Indian Stock Markets faced huge selling pressure all through the week (except that of Monday’s trading session) due to the political drama played at the state of Karnataka after election result was out.

Though Saturday is crucial as far as Karnataka is concern, going forward markets will focus more on the corporate results that will announce early next week and the progress of monsoon in later part of the month. The movement of INR v/s USD and the crude oil prices will be closely monitored in the coming sessions as well.

On the technical front, the Nifty index likely to go down further and may find support near 10450 to 10490 levels which is its 89 DEMA.

Finblab is of the view that the Indian Markets will consolidate in the near term, 10450-10490 on the lower side and 10800-10850 on the upper side, due to lack of fresh positive news globally as well as on the domestic front, however, if the on-going correction last long it should be considered as a good opportunity for the long-term investors to buy good and fundamentally solid stocks on dips.

Also Read –

1) Finblab’s Valuepick Stock for the month of May – GMM PFAUDLER LIMITED ( 9.10% Return in just 15 Days )

Disclaimer: The contents and data presented here are just for your information & personal use only. While much effort is made to provide the information, I ( Vishal Dalwadi ) or “Fin Blab” do not guarantee the accuracy, correctness, completeness or reliability of any information or data displayed herein and shall not be held responsible.