On Friday, Sensex closed at 59,307.15 up 104.25 points or 0.18%, while Nifty 50 edged higher by 12.35 points or 0.07% to end at 17,576.30. Heavyweights like Axis Bank, ICICI Bank, HUL, and Kotak Bank were the top performers for their Q2 results.

In terms of sectoral indices, BSE Bankex rose by nearly 949 points, while Bank Nifty rose by over 684 points on 21 October.

Meanwhile, the rupee edged higher against the US dollar amid firmness in domestic equity and continued rise in treasury yields along with RBI intervention. After cracking 83-marks, the rupee closed at 82.6750 per dollar on Friday. In the last six weeks, the domestic currency has fallen by around 4% against the greenback.

On the other hand, after bearish sentiment on equities, FIIs turned into net buyers in the last two trading sessions of this week with October 20 looking the most buying. On October 21, FIIs pumped in 438.89 crore in the ordinary shares, and on October 20 — the investment was in line with 1,864.79 crore. From October 17-19, FIIs were selling the equities approx 979.34 crore.

From last week, Sensex rose more than 1,387 points or 2.4%, while Nifty 50 rose almost 391 points or 2.3% respectively in the week between October 17-21. Compared to last week, the market cap of BSE listed companies jumped more than 4.13 lakh crore in the week ending October 21, 2022, to nearly 274.42 lakh crore. The market cap was over 270.29 lakh crore by the end of October 14 last week.

Vinod Nair, Head of Research at Geojit Financial Services said, “Despite global weaknesses, domestic sentiment was positive ahead of Diwali and the market showed its resilience, supported by a good start to the earnings season. The benchmark indices have been rising recently. six sessions, aided by stock-specific momentum in IT, banks, and FMCG The rise in credit growth to a 10-year high of 17.94% YoY in October added color to the bank nifty with a gain of 3.8%, while acquired PSU banks gained 11% during the week.”

What to expect in markets week from 24-28 October?

Trading in equities, derivatives, commodities and other securities will be closed on October 24 due to Lakshi Pujan (main Diwali) and on October 26 due to Balipratipada Diwali celebrations. Therefore, trading will be allowed only on October 25, 27, and 28. However, markets will open for one hour on October 24 from 6.15 pm to 7.15 pm as part of Muhurat trading.

According to Nair, some profit booking was also seen towards the end of the week with domestic investors maintaining their cautious stance ahead of the truncated week. Globally, UK inflation rose to a 40-year high of 10.1% in September, adding to fears of a more aggressive monetary policy by the central bank. As there are no major triggers for next week, market direction will be based on global sentiment and the earnings season.

Further, Mitul Shah – Head of Research at Reliance Securities said, “The Indian rupee breached the 83-per-dollar mark for the first time, due to rising dollar demand from fuel companies and widening current account deficit. A rising dollar and strengthening US bond yields only added to the weakness. The Indian rupee has fallen ~12% against the dollar so far this year. The market fears that further rate hikes from the US Fed could further tighten US Treasury yields, further weakening the rupee.”

Also, Shah said, “The 2QFY23 earnings season saw healthy growth in revenue but higher inflationary pressure put pressure on profitability. So far 120/BSE500 companies revenue grew 23% YoY, EBITDA increased 15% YoY and PAT was mostly flat. on a YoY basis.”

Shah added, “Inflation remains sticky, both in the domestic economy and in the US. India’s growth remains strong and is expected to be one of the fastest growing economies in the world, while the global recession and downgrade continued growth for major economies. The market is eyeing the US Fed monetary policy meeting scheduled for November 2. Commentary on holiday demand, inflation expectations and rate hikes will be closely watched in the near term.”

Some of the major Q2 earnings to watch in the week of October 24-28 are – Dabur, Tata Chemicals, Indus Tower, SBI Card, REC, and PNB Housing Finance among others.

Disclaimer: The opinions and recommendations made above are the opinions of individual analysts or brokerage firms, and are not the opinions of Mint.

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