Nifty outlook: If a week is called ‘forgetable’, then the name of Nifty’s name will come up last week. NIFTY from high of 25,448 on September 18 has fallen 800 points so far. This means that 80% of the 1,000 point rally that came from the lowest level of August 29 returned.
Now in the week starting on Monday 29 September, how will the Nifty move, which level will be important, you will understand it from experts. But, before that we know what happened in the market on Friday.
Most pressure on Nifty
Last week, the most pressure was on the IT sector. The decline of six days in the country’s largest tech companies lost a market cap of more than Rs 2 lakh crore. This is about 12.5% of the total loss of Rs 16 lakh crore. TCS alone contributed 50% of it. The Tata Group’s stock reached the bottom of the 52-wheel. It has not given any returns to investors in the last three years.
If the IT shock was not enough, then there was pressure on the pharma sector on Friday. Especially after the tariff announcement of US President Donald Trump. On this day, shares like Sun Pharma came to a low-level of 52-Veik. Like IT, the pharma sector also saw a lot of weakness.
Market challenges in the coming week
Nifty is now entering a important week. Tariff related events will be focused, but many other news will also have to be monitored. First, the quarter is ending on Tuesday. Companies will start releasing their quarterly business updates from Wednesday. The results of auto companies will first come.
After GST improvement, there has been a tremendous rise in auto stocks. They have increased by 15% to 20% in the last one month. Big names like Maruti Suzuki, Eicher Motors, Hyundai Motor India, M & M are either on record high or trading close to it. It remains to be seen whether their results justify this boom or not.
Small auto enlightened companies showed even more in the last two weeks. Small names like Racl Geartech, Automotive Stampings and Assemblys, Munjal Auto saw a jump of 15% to 30% last week. At the same time, FMCG companies will also be monitored. GST reform is expected to increase consumption. However, HUL said in a quarterly update on Friday that the performance in the current quarters may be slow. Its effect can also be seen in October.
RBI’s policy rate expectations
RBI will announce the results at the repo rate on Wednesday (October 1). The market is still divided about the fact that MPC should make one more cuts or the rates should remain the same. SBI Research believes that RBI will have a scope for 25 basis point cut in repo rate. However, several other experts estimate that factor RBI may prevent RBI from rate cut with GST improvement and weakness in rupee with American tariffs.
Which level is important for Nifty
NIFTY is now looking towards the lower levels for support after a decline of six days. Closed at 24,650 on Friday, which is the first defense line. On going below, the lows of 24,621 (5 September), 24,533 (September) and 24,404 (29 August) will be seen respectively. At the top, crossing 24,800 will be the first important level, then the Nifty can go close to 25,000.
Nifty Bank contributed significantly to the recent 1,000-point rally. He is also in a recent decline. The Nifty Bank went up to 55,700 in the recent rally, but could not stand. It is now below 55,000 and is near the psychological support level of 54,500. If there is a bounce from the oversold level, then you have to keep an eye on the top of 54,500.
Expert opinion on Nifty
According to Vatsal Bhuva of LKP Securities, NIFTY’s 20 and 50-day exponent moving average (EMA) breaks downs on Friday indicates weakness in short term as well as overall market sentiments. They believe that as long as the NIFTY is below the level of 25,000, the market mood will remain bearish. The next important level at the bottom is 200-day Dema, which is around 24,400.
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According to Ajit Mishra of Religare Broking, weakness in big companies has intensified the decline. The index is now reaching a level of 24,400 with the 200-DEMA, followed by an area of 24,000-24,200. At the same time, if there is any kind of recovery in the market, then the first support level will serve as a resistance of 25,000 (20-Dema).
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