Markets end the week in red amid volatility, Nifty resistance at 15900; stock specific action to continue

Markets end the week in red amid volatility, Nifty resistance at 15900; stock specific action to continue

Bears maintained dominance on Dalal Street on Friday as investors booked profit in banks and metal stocks in a highly volatile session. After fluctuating between green and red, the markets ended lower for the sixth straight day. The S&P BSE Sensex slumped 992 points from the day’s high to end at 52,794, down 137 points or 0.26%, while NSE Nifty 50 shut shop at 15,782, down 26 points or 0.16%, after hitting an intra-day high of 16,084. In the broader market, the BSE SmallCap and BSE MidCap index ended in green. Sectorally, the Nifty Metal index fell 2%, followed by the Nifty Bank index (down over 1%). On the upside, the Nifty Auto index gained 2.5% led by Tata Motors. Markets are likely to remain volatile in coming sessions, stock-specific action will continue amid ongoing result season, according to analysts.Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities

“Global and domestic equity markets saw sharp decline this week as investors are worried about growth expectations amid elevated inflation levels. Sensex 30 and Nifty 50 index was down by close to 3%. BSE Midcap and BSE Smallcap index saw higher correction in the range of 5-6%. Almost all sectoral indices reported decline this week. In India, the CPI inflation in April 2022 surged to 7.79% (March 2022 : 6.95%), while March 2022 IIP growth remained subdued at 1.9% (February 2022: 1.5%). FII’s continued their selling of Indian equities this week. Rising bond yields, high inflation levels and monetary policy tightening action by Central Banks globally will weigh on near term sentiments which could keep markets volatile. Stock specific action will continue due to ongoing result season.”

Amol Athawale, Deputy Vice President – Technical Research, Kotak Securities

“Volatility was once again the order of the day and key indices snapped early gains on late selling pressure in metals, telecom & banking stocks. The fall came despite an upsurge seen in other Asian gauges, as the fear of rising inflation and expectations of more rate hikes in the near term weighed on investors’ minds. It looks like traders are selling at every opportunity given that there seems to be no respite from the negative news flows. After a sharp price correction, on weekly charts, the Nifty has formed a bearish candle and after a long time it closed below 16000 mark which is broadly negative. For traders, 15900 would act as a key resistance level and below which the index could slip till 15650. However, 15900 would be the immediate trend reversal level for the bulls and above which we could see a strong pullback rally up to 16100-16300.”

Mitul Shah, Head Of Research at Reliance Securities

“Domestic equities closed lower by giving earlier gains recorded during the day, led by mixed global cues, as volatility in the markets continue to rankle investor sentiments. While the Indian economy has shown signs of growth and recovery across the board despite elevated input and labour costs and ongoing supply chain disruptions, inflationary pressures continue to loom as it is largely predicted to be about 7.5%, far beyond the central bank’s tolerance band. Amid the turbulent economic environment, investors await on the next set of earnings results during the week, along with several IPOs which are expected to open for subscription. Global markets are likely to determine the trajectory of Indian equities.”