Last week saw profit booking weigh heavily on the Indian share market, with investors trimming their positions across all trading sessions. This resulted in a 2.6% dip in the Nifty, closing the week at 19,674 points. The mid-cap index also witnessed a 1.7% decline, while the small-cap index suffered a 2% weekly setback. The banking sector, represented by the Bank Nifty, didn’t escape the pressure, posting a 3.5% drop and closing at 44,612 points. Foreign Institutional Investors (FIIs) were net sellers, with a selling volume of 6,677 crore rupees, while Domestic Institutional Investors (DIIs) netted purchases worth 1,137 crore rupees.
HDFC Bank Tops Nifty Losers
Among Nifty constituents, HDFC Bank stood out as the top loser, shedding 8% of its share price to close at 1,529 rupees. This decline led to a substantial erosion of the bank’s market capitalization by 1 lakh crore rupees. Other prominent losers included UltraTech Cement, down by 6.3%, Wipro with a 5.1% drop, JSW Steel posting a 4.7% decline, and Reliance Industries witnessing a 4.3% dip in its share price.
Global Markets Witness Healthy Corrections
Global markets also displayed signs of weakness during the past week. The Dow Jones recorded a 1.6% decline, while the tech-heavy Nasdaq index saw a 3.5% drop. The broad-market index S&P 500 experienced a 2.7% contraction. European markets were not spared, with Germany’s DAX down by 2%, France’s CAC declining by 2.2%, and the UK’s FTSE 100 posting a 0.4% reduction. Asian markets followed suit, with South Korea’s KOSPI shedding 3.6%, Hong Kong’s Hang Seng down by 0.7%, and Japan’s Nikkei declining by 3.4%.
Key Levels for Nifty
SBI Securities reports a bearish trend emerging in the market, with immediate support for Nifty seen at the 19,550-19,500 levels. Breaking the 19,500 support could signal a significant correction. In a bullish scenario, the 19,800-19,850 levels could pose immediate resistance.
Diwali Target for Nifty Set at 20,700
ICICI Direct’s report notes that the US Federal Reserve has kept interest rates unchanged at a 22-year high. Crude oil prices have surged, currently standing 22-24% higher compared to June, at $94 per barrel. Nifty is currently consolidating in the range of 19,500 to 20,000, with a target set for Diwali at 20,700, while 18,900 remains a strong support level. In the coming period, sectors such as Banking, Financial Services, Insurance (BFSI), Automobiles, Information Technology (IT), Power, and Consumer Goods are expected to be in focus.
Upside Bounce Possible from 19,550 Levels
HDFC Securities’ Retail Research Head, Deepak Jasani, suggests that if Nifty slips below 19,645, it could test the 19,460-19,480 levels. In a bullish scenario, the 19,849 level is expected to act as immediate resistance. Technical analyst Nagaraj Shetty points out that Nifty could see an upside from the 19,550 levels, while the 19,800-19,850 range is likely to present a barrier for further gains.
As the market continues to grapple with profit booking and global uncertainties, investors are advised to remain cautious and closely monitor these key levels and developments in the coming weeks.