Mr. Deepak Jasani, Head of Retail Research, HDFC Securities
Nifty rose sharply on Sept 30, breaking a 7 day falling streak. In the process it gained the most in a month, but extended losses over the week. This is the third consecutive weekly decline for the Nifty as it logged the worst month since June. Nifty opened slightly lower but soon began to rise following early encouraging cues from the Asian markets. At close Nifty was up 1.64% or 276.3 points at 17094.35. In the process, Nifty was the best performing index in the Asian region.
Among sectors, Metals, Banks and Telecom indices rose the most even as all indices ended in the positive. Midcap and Smallcap indices mildly underperformed the Nifty even as advance decline ratio was the best since Aug 30, 2022.
Shares in the Asia-Pacific ended mostly lower on Friday, the last day of the third quarter, following another sell-off on Wall Street overnight. European stocks were a touch higher on Friday as government bond yields pulled back from recent peaks, but higher-than-expected inflation continued to weigh on markets.
The U.K. economy grew in the second quarter, with gross domestic product rising 0.2%, a surprise improvement on the previous estimate of a fall of 0.1%. Euro zone inflation hit a new record high of 10% in September, up from 9.1% in August and above consensus projections of 9.7%.
India's Monetary Policy Committee has hiked the benchmark repo rate by 50 basis points-its fourth straight increase to 5.90% - which is the highest in the last 3 years -in continuing efforts to quell inflation in the economy.
Nifty formed an engulfing bull pattern on daily charts while forming a bullish hammer pattern on weekly charts despite a 1.35% weekly fall. This could portend an upside bounce in the coming week with 17292 and 17540 being the upside targets. Lack of breakout volumes on Sept 30 is a minor worry. 16752-16794 band could provide support.