Tag: Weekly report

Categories
Weekly Reports

10-Feb-24 Technical & Fundamental Insight

Last week – review

Going into trade last week, we were cautious as market rally seems to be showing some sing of weakness post Budget on 1-Feb-24.  We see budget as non-event as there was no major expectation as it was Vote-On-Account ahead of general election in April – May 2024.  Market this week ended with minor cuts as RBI MPC policy was due this week.

Technical Insight

• Nifty in last two week has been trading in range of 21411 to 22115, Nifty has made double top on last Friday would act as resistance level.  Nifty range expected this week is 21680 to 22115.

• Banknifty range for this week is expected to be 45295 to 46571.  Any major move in Banknifty expected once this range is broken on either side.

Approach on Technical: Indian market reacted to Budget last week and RBI MPC policy this week.  We expect indices to follow technical direction as there are no major scheduled event, outcome of which can impact market direction.

Nifty @ 21680 & Banknifty @ 45295 to act as important support level.  If indices break this level – fresh downside could be expected, otherwise we see indices could attempt fresh up move.

Fundamental Insight

RBI Monetary Policy Key Takeaways

• To keep the repo rate unchanged at 6.5% by a 5:1 majority.
• The standing deposit facility rate, pegged 25 basis points below the repo rate, is at 6.25%.
• The marginal standing facility rate, which is 25 basis points above the repo rate, is at 6.75%.

The MPC also decided to remain focused on the withdrawal of accommodation to ensure that inflation progressively aligns with the target, while supporting growth.

India To Sell $11.6 Billion Airwaves to Boost Phone Networks

India’s federal cabinet Thursday approved a plan for selling airwaves in an auction to improve quality and coverage of networks in the world’s second-biggest telecom market.

Forex Reserves Jump To $622.469 Billion

India’s forex reserves jumped by $5.736 billion to $622.469 billion for the week ended Feb. 2, the Reserve Bank said on Friday. In the previous week, the overall reserves had increased by $591 million to $616.733 billion.

Equichain Wealth Advisors: Market View & Strategy

We have remained cautious in last few weeks and continue to remain cautiously optimistic but will continue to follow strategy of fresh allocation on correction.  

We see market at current level has factored in political stability, US fed pivot on interest rate and earnings season so far has failed to provide fresh positive triggers.  Rally in PSU stocks continue on optimism of political stability, but we do believe valuation are stretched in near term.

We would continue to keep exposure around 75% and major allocation would be preferred on correction.  We may review our stance incase indices hit fresh high supported by some positive triggers on interest rate going down or any other substantial news which could change market narrative.

Click on the attachment to read the full report:
10-Feb-24 Fundamental & Technical Insight.pdf
View Document
Categories
Weekly Reports

30-Dec-23 Technical & Fundamental Insight

Last week – review

Going into trade into last trading week, we expected market to test its recent high and close at higher level due to year end rally.  Most indices closed at highest level with week gains of around.  Indices on Monthly basis has rallied more than 7% on major indices while Mid-cap & Small-cap gained just under 7%.  

Global market closed flat on weekly basis as market was in holiday mood and low volatility.Now let us looks at year change for all these major indices.  Nifty 50 & SENSEX30 gained around 20% while Banknifty underperformed among indices by growth of up to 12.34%.  

Highlight will be Mid-cap 100 & Small-cap100 indices which gained by 46.57% and 55.62% respectively.  After underperforming in 2022 and early part of 2023, 2nd half of calendar year 2023 delivered one of the best returns in recent times.  

Equichain Wealth Advisors: Market View & Strategy  

This week we will not focus on technical because the movement we have seen in last two weeks was mainly due to year-end rally.  We would now focus on fresh indication from technical trend.

We see year-end rally to cool-off in first week and then corporate earnings will take lead from here on.  We remain optimistic on IT and Banking stocks going into earnings season as improvement in global sentiment will play important role, even if result may be weak but we expect positive commentary from IT companies.   Globally expectation of interest rate to cool-off has provided big boost for banking and financials company.  Any correction in first few weeks can be seen as opportunity to deploy fund available.

As mentioned in our earlier we have remained invested around 70% in trading portfolio and 80% in positional portfolio.  Rally in last week was used to book part profit for short term trades and fresh review will be taken with view on corporate earnings, Vote on account (mini budget before general election on 1-Feb-24) and potential reversal in interest rate globally.

Click on the attachment to read the full report:
30-Dec-23 Fundamental & Technical Insight.pdf
View Document
Categories
Weekly Reports

9-Dec-23 Technical & Fundamental Insight

Last week – review

Going trade last week, we kept our focus on technical and market internal and we remain bullish.  But the biggest surprise came from state election result declared on 3-Dec-23 where BJP got massive mandate in 3 states, MP, Rajasthan & Chhattisgarh – Market took this election with big positive move on Monday and followed by weekly gains of above 3% on Nifty & SENSEX and Banknifty gained over 5% this week.  

Technical Insight

• Nifty likely to see sideways consolidation and 20698 & 20508 will act as important support level.  Nifty upward momentum continues to remain strong.

• Banknifty, consolidation from current level could be considered as healthy.  Banknifty key support level on downside comes at 45702 & upsides remains open.

Approach on Technical: Monday, 4-Dec-23 move was surprise and it has changed the narrative & chart pattern in near term.  Technical setup needs to adjust to new reality and premium after Monday’s move.

Our strategy for next would be to wait for confirm negative divergence or negative signal before we book further profit or hedge.  Nifty @ 20508 & Banknifty @ 45702 are two important level to watch incase of any correction.  These levels are current 2% to 2.5% from current level.  Any Fresh long position would be preferred around this level.  Momentum on indices remain strong and we would avoid fresh long as we see trend reversal from current level.

Fundamental Insight

RBI Monetary Policy Highlights: Repo Rate Unchanged At 6.5%, Raises GDP Growth Forecast To 7%

Following the review, the MPC decided:

• To keep the repo rate unchanged at 6.5% unanimously. 
• The standing deposit facility rate, pegged 25 basis points below the repo rate, is at 6.25%. 
• The marginal standing facility rate, which is 25 basis points above the repo rate, is at 6.75%. 

The committee had raised the benchmark repo rate by 250 basis points in the last cycle before opting for a pause starting in April’s meet this year.

Taking into account these factors, CPI inflation is projected at 5.4% for 2023-24, Q3 at 5.6% and Q4 at 5.2%, with risks evenly balanced. Assuming a normal monsoon next year, CPI inflation for Q1:2024-25 is projected at 5.2%; Q2 at 4.0%; and Q3 at 4.7%. The risks are evenly balanced. 

Shaktikanta Das, Governor, RBI

Equichain Wealth Advisors: Market View & Strategy

We would continue to remain bullish on market with a medium-term view, but in short term after recent run-up, we may utilize this rally to book part profit and reshuffle portfolio as we appropriate opportunity.  Momentum remains strong but technical indicates that market is in over-bought zone.  Market from current level would consolidate sideways or correct from current level.  We would wait for correction to initiate fresh buys.

This state election result was seen as semi-final ahead of general election.  Market reaction to this result was positive and market is now trading at premium as we see at least 5% premium is seen as far as overall market is concern.  

We have turned our view bullish on IT stocks ahead of US Fed meeting outcome on 13-Dec-23 and TCS buy-back acceptance announcement this week.  IT in recent times have underperformed and any positive trigger could trigger positive reaction in IT stocks.

Click on the attachment to read the full report:
9-Dec-23 Fundamental & Technical Insight.pdf
View Document
Categories
Weekly Reports

12-Aug-23 Technical & Fundamental Insight

Last week – review

Indices this week ended with cut of under 1% on major indices and Banknifty loss by 1.52%.  RBI MPC meeting outcome on 10-Aug-23 – RBI kept repo rate unchanged at 6.50% and continue its stance of “Withdrawal of Accommodation” with 5:1.  Indices seen consolidating for 2nd straight week.  

Technical Insight

• Nifty on daily chart indicate further weakness.  Nifty @ 19160 could act as key support level and Nifty below 19160 could test 18646.

• Banknifty RSI & RSI average indicate further weakness.  Banknifty could test 43541 and further downside possible.

Approach on Technical: Indices on daily chart are seeing some kind of weakness, further consolidation seems likely in the month of August 2023.

Nifty range of this week looks like 19160 to 19674, Nifty below 19160 could indicate further weakness towards 18646.  Nifty above 19674 could be considered as trend reversal as bullish.  Banknifty closed below 44578 could test 43541 level this week.

Fundamental Insight

1) Bank Credit Growth to MSMEs Decelerates in June Quarter: RBI Data
2) Cabinet Approves Rs 1.39-Lakh Crore Plan For Rural Broadband
3) SBI Seeks Buyers For Its Rs 96,000 Crore Bad Loans
4) Credit Card Default Rises To Rs 4,072 Crore In FY23

Equichain Wealth Advisors: Market View & Strategy

Global cues continue to remain mix as market consolidated this week.  With Q1FY24 result near to its end, we see further consolidation and correction from current level would be healthy after market rally seen since last April 2023.

We see current rally as opportunity to reduce exposure and keep exposure around 70% to 85%.  After recent run-up seen in pharma stocks, some sign of fatigue seen.

Click on the attachment to read the full report:
12-Aug-23 Fundamental & Technical Insight.pdf
View Document
Categories
Weekly Reports

29-Jul-23 Technical & Fundamental Insight

Last week – review

Market started this week with cues from RELIANCE, KOTAKBANK & ICICBANK result.  Technical setup does indicate some pause and market this week after brief consolidation have seen correction. Market corrected on Thursday & Friday making indices to close with minor loss on weekly basis.

Technical Insight

• Nifty rally from 18646 to 19991, retracement @ 38.2% comes @ 19478 & 61.8% comes at 19160.  Nifty below 19478 could test 19160 level and Nifty above 19861 could resume fresh uptrend.

• Banknifty rally from 43541 to 46256, retracement @ 38.2% at 45219 was tested on Friday, further correction could test 44578.  Banknifty above 45841 could resume positive trend.

Approach on Technical: Indices after all most 16% -18% rally in last 3 – 4 months is showing some sign of weakness on charts.  Indices have witness sideways consolidation during this rally and we may continue to see that trend.

Nifty @ 19478 & Banknifty @ 45219 are 38.2% retracement level of their recent rally.  Any weakness could trigger correction up to 61.8% retracement level on Nifty @ 19160 & Banknifty @ 44578.  We assume that uptrend will resume once Nifty @ 19841 & Banknifty @ 45927 is crossed.

Fundamental Insight

1) India GDP To Grow 6-6.3% In FY24, Economic Prospects Brighten: Deloitte India
2) Surging India Prices May Keep RBI on Extended Pause, IMA Says
3) IMF Raises India’s GDP Forecast To 6.1% For FY24

Equichain Wealth Advisors: Market View & Strategy

During the last few weeks, we have maintained our strategy to participate in this rally with keeping exposure around 70% to 85% and some allocation towards defensives.  We would prefer stock rotation while keeping exposure at same level and we continue to maintain our strategy.  This week we would focus on defense stocks, telecom & PSU where result is awaited.  Any correction would provide fresh view on market to deploy fund available with us. 

Buying keeping allocation at 70% – 85% in last few weeks, we have managed to perform in-line with index and any we would deploy fresh fund on correction as we believe market will continue to correct and have stock specific approach.

Click on the attachment to read the full report:
29-Jul-23 Fundamental & Technical Insight.pdf
View Document
Categories
Weekly Reports

15-Jul-23 Technical & Fundamental Insight

Last week – review

Going into trade last week, we had maintained cautious view with allocation to be kept around 70% to 85%.  Market momentum seems to be very strong as tech stock which came out with Q1FY24 result, stock prices reacted positively despite weak numbers.

Technical Insight

Nifty RSI @ 72.51 & RSI average @ 70.30.  Nifty closing @ 19564.50 is highest closing recorded in this rally.  Nifty next target / resistance comes at 19716 & support level comes at 19371 & 19232.

Banknifty RSI @ 58.15 & RSI average @ 59.06.  Banknifty closing on Friday’s closing at 44819, immediate resistance at 45110 & support level comes at 44228.

Approach on Technical: Indices rally looks a bit over-stretched.  Momentum on Nifty is very strong and indicate that outperformance may continue over Banknifty in near term.

Our strategy would focus on any long trade would be short term in nature, we continue to remain cautious after huge rally on indices without any major correction.  Nifty @ 19232 & Banknifty @ 44773 would act as strong support level.  Once this level is broken, can expect further downside.

Fundamental Insight

1) India’s Trade Deficit Narrows To $20.1 Billion In June As Exports, Imports Decline
2) India’s WPI Deflation Widens To Near Eight-Year Low In June
3) HDFC Shareholders Allotted Over 311 Crore Shares Of HDFC Bank

Equichain Wealth: Market View & Strategy

We see current rally and momentum very strong as reaction to weak result from IT stocks supported by positive commentary from management that worst is over.  We are already at lower end of the exposure and current rally would stretch valuation a bit more.  HDFCBANK will come out with result on 17-Jul-23, which will provide cues on who banking stocks would react?  Loan growth and advance remain high at average of 15%.  

We are comfortable with our current exposure in equity around 70% to 85% and continue to find opportunity of stock rotation and maintain allocation level at current level.  We would review IT stocks as worst may be behind us and inflation cooling off in US will provide much needed boost for tech spending helping IT stocks.

Click on the attachment to read the full report:
15-Jul-23 Fundamental & Technical Insight.pdf
View Document
Categories
Weekly Reports

8-Jul-23 Technical & Fundamental Insight

Last week – review

Going into trade this week, we maintain status quo and keep exposure around 70% to 85%.  Momentum in indices continue at the beginning of the week which later witness some selling pressure on Friday.  Nifty Small-cap 100 gain by 2.60% this week, other indices gain was capped below 1%.

Technical Insight

• Nifty level for this week would – support level @ 19181 & 18977 & resistance level @ 19512 & 19781.  Nifty likely to continue in consolidation zone with negative bias.

• Banknifty level for this week would – support level @ 44773 & 44228 & resistance level @ 45655 & 45990.  Banknifty seems to be in consolidation zone in uptrend.

Approach on Technical: Indices RSI & RSI average trading near 70 level before seen some supply at higher level after rally of 4% – 5% on Nifty & Banknifty with out any correction.  Fast up move on Indices do indicate some consolidation would be healthy.

Our strategy would to find fresh entry opportunity on correction, Nifty @ 18977 & Banknifty @ 44228 & 43345 would provide healthy entry opportunity.  We would avoid chasing momentum and play catch-up in upward momentum.  

Fundamental Insight

1) Annual Economic Review: Amidst Durable Domestic Growth, External Risks Persist
2) India’s Services PMI Stays Strong Despite Easing In June
3) India Should Push to Add Its Bonds to Global Indexes: RBI Report

Equichain Wealth: Market View & Strategy

Market will now focus on earnings season; IT will start earnings season with HCLTECH & TCS to come out with result on 12-Jul-23 & INFY on 20-Jul-23.  HDFCBANK which usually comes out with result in 2nd week and first among private banks to declare earnings is yet to announce day for Q1FY24 result.

We will continue to maintain strategy to remain invested in range of 70% to 85% and continue keep cautious stance.  Recent run-up seen on indices was too fast as compared to expectation.  Global cues continue to remain muted and indicate rate could go higher.

Click on the attachment to read the full report:
8-Jul-23 Fundamental & Technical Insight.pdf
View Document
Categories
Research Report

Global Market – China’s economic recovery hits road block

Global Market – China’s economic recovery hits road block

This week we will discuss China’s growth momentum slows further and need further stimulus.  China’s Central bank PBOC continues its support for YUAN as currency continues to weaken.  China after following strict COVID policy since March 2020 has removed strict restriction from 8-Jan-23.

China June PMI @ 49 – reading below 50 is contraction

Speculation about potential policy support has been mounting as the recovery for the world’s second-largest economy loses traction. After a burst of activity in the first quarter, consumer spending is slowing. The housing rebound has fizzled, exports have weakened and infrastructure investment has been muted, too.

China’s PBOC Sticks with Yuan Support as Currency Losses Deepen

The central bank set its so-called fixing for the managed currency at a stronger-than-expected level on Friday, after the offshore yuan extended a seven-month low. The move came after reports that regulators have stepped up scrutiny of currency trading and cross-border capital flows, in a bid to stabilize the yuan.

China removes strong COVID restriction from January 2023

China after following zero tolerance COVID policy for more than 2 years since COVID in March 2020 has taken steps to remove restriction from January 2023 and support economy.   Travelers coming into China were required to follow COVID restriction policy and go through quarantine period before of 7 days.

Equichain Wealth Advisors: Market View & Opinion

The People’s Bank of China will likely reduce the rate on its one-year policy loans — known as the medium-term lending facility — by 5 basis points to 2.6% in the final quarter of this year, according to the median estimate in the latest quarterly survey.

China economic data continues to show worrying sign where as US Fed, ECB & BOE continues to raise rates as inflation remains key risk in developed economy.  Inflation is not a concern in China – 2nd largest economy.   Global market continues to trade near its recent high market is factoring in some kind of stimulus and any weakness in economic recovery will be blessing for market and risk-on sentiment.

Click on the attachment to read the full report:
Global Market – China’s economic recovery hits road block.pdf
View Document
Categories
Weekly Reports

1-Jul-23 Technical & Fundamental Insight

Last week – review

We went into last week with muted expectation, but indices witness healthy rally in a holiday shorten week and F&O expiry.  HDFCBANK & HDFC merger will be effective from 1-Jul-23 and that trigger huge rally in HDFC twins.  All major indices were up by around 2.5% recording in one of the best weeks in recent times.

Technical Insight

• Nifty RSI @ 72.04 & RSI average @ 64.08.  Nifty RSI back to above 70 level and gap between RSI & average has more than 8 and indicate overbought zone in near term.

• Banknifty RSI @ 65.36 & RSI average @ 55.93.  Banknifty gap between RSI & RSI Average is around 10 points indicate overbought zone.

Approach on Technical: Indices rally this week was sharp which has increase gap between RSI & RSI average by 8 to 10 points on Nifty & Banknifty, indicate overbought zone in near term.

Our strategy this week would be seek buying opportunity around on Nifty around 18932 & 18765 & Banknifty around 44530 & 44253.  Going into trade next week do indicate overbought zone and current momentum could take indices higher on Monday before we expect some cool-off or profit taking.

Fundamental Insight

1) Share Of Loans Bearing Over 9% Interest Rate Hits 56.1% In March, Says RBI
2) Commerce Minister Asks Bankers to Ensure Enhanced, Affordable Credit to MSME Exporters
3) HDFC Bank-HDFC Merger To Be Effective July 1

Equichain Wealth: Market View & Strategy

This week, SGX Nifty will start to trade in GIFT CITY from Monday 3-Jul-23 and will be now know as GIFTNIFTY.  Market momentum remains strong and major economic data will come only later in the week.

Our strategy going into this week will be to find suitable entry opportunity and would be preferred on decline and will continue to maintain exposure around 70% to 85% as we mentioned in last week.  We would continue to seek opportunity with basket of stocks and place our allocation to be beneficial going into result season.  We are optimistic on Banks & infrastructure and have cautious view on IT sectors.

Click on the attachment to read the full report:
1-Jul-23 Fundamental & Technical Insight.pdf
View Document
Categories
Weekly Reports

24-Jun-23 Technical & Fundamental Insight

Last week – review

Going into trade this week, trend remain mix as indices was trading near its recent highs, BSE Sensex made fresh and manage to cross December 2022 high while Nifty is yet to make fresh lift-time high.  Market witness profit booking and selling pressure from higher level, Mid-cap & Small-cap were looser on weekly basis after 12 weeks of continuous gains.

Technical Insight

 Nifty RSI @ 54.84 & RSI average @ 62.25, Nifty RSI indicating negative trend in near term with 18567 as first support level & 18374 as intermediate support level.  

• Banknifty RSI @ 47.92 & RSI average @ 51.38.  Banknifty is trading below its 20-DMA @ 43956 which is now acting as resistance level.

Approach on Technical: Indices are currently trading near upper-end of the range and facing supply ahead of F&O expiry next week for June 2023 series.  

Nifty below 18567 & Banknifty below 43314 could open further downside which could test lower level on Nifty @ 18131 & Banknifty @ 42493.  This week could turn out to be broader correction, while uptrend would resume in case of Nifty manages to move above 18807 & Banknifty above 44046.

Fundamental Insight

1) RBI Nowcasting Model Pegs Q1 FY24 GDP Growth At 7.9%
2) MPC Minutes: Job to Contain Inflation Only Half-Done, Says RBI Governor
3) EPFO Adds 17.20 Lakh Net Members In April: Labour Ministry

Equichain Wealth: Market View & Strategy

We believe it’s time to book profit and reduce exposure, with Q1FY24 result season to begin from 2nd week of July, market will focus on final F&O expiry and global cues.  We have reduced our exposure around 75%, but will continue to maintain allocation around 70% on lower side and 85% on higher side.  

Going into final F&O expiry for June series, we expect market to correct / consolidate at lower level which could provide fresh entry opportunity.

Click on the attachment to read the full report:
24-Jun-23 Fundamental & Technical Insight.pdf
View Document