Indian share market weekly Analysis: Nifty50, Q4 results, the global market cues for next week

The Indian share market Nifty50 and Sensex ended in a positive note last week. Traders overlooked Moody’s downgrade rating for India, increasing coronavirus cases and weak GDP numbers last week and continued buying in the market. In spite of several negative domestic cues, the Indian share market reacted positively with the help of the global market.

On a weekly basis, Nifty50 gained 561.85 points or 5.85% and at 10142.80 while Sensex was up by 1863.24 points or 5.75% and at 34287.24. The banking sector led the market rally last week. The NSE banking index Bank Nifty gained 1737.25 points or 9% and  closed at 21034.50

Last week’s market rally was seen across sectors, Nifty midcap and smallcap stocks made a superb rally. The Nifty midcap 100 index gained 885.05 points or 6.65% whereas the Nifty smallcap 100 index 420.3 points 10.51%.

Nifty50 gainers and losers for the week

Weekly Nifty50 Gainers
Company Name	LTP	Previous Close	Change (%)
Tata Motors	110.75	87.00	27.30
Bajaj Finance	2390.35	1953.65	22.35
Bajaj Finserv	5236.40	4404.90	18.88
SBI	187.80	161.30	16.43
Tata Steel	338.95	295.20	14.82
Weekly Nifty50 Losers
Company Name	LTP	Previous Close	Change (%)
Asian Paints	1638.55	1683.10	2.65
Nestle India	17096.85	17540.80	2.53
Dr. Reddy’s Lab	4024.90	4071.25	1.14
Ultratech Cement	3869.55	3904.85	0.90
Hero Motor Corp	2340.65	2360.85	0.86

Nifty midcap and smallcap gainers and losers

Weekly Nifty Midcap 100 Gainers
Company Name	LTP	Previous Close	Change (%)
IDBI Bank	38.55	20.45	88.97
Bank Of India	42.10	31.40	33.86
Weekly Nifty Midcap 100 Losers
Company Name	LTP	Previous Close	Change (%)
Info Edge India	2500.10	2683.80	6.84
Ajanta Pharma	1464.70	1523.95	3.89
Weekly Nifty Smallcap 100 Gainers
Company Name	LTP	Previous Close	Change (%)
Chalet Hotel	163.30	100.40	62.65
Trident	7.35	4.55	61.54
Weekly Nifty Smallcap 100 Losers
Company Name	LTP	Previous Close	Change (%)
Multi Comm Exch	1210.35	1328.05	8.86
Indiamart Inter	2330.95	2477.40	5.91

 

News on Indian Economy

As per the report, the Indian economy slowed consecutively for the fourth quarter in the March-end 2020 to 3.1% as against the growth of 4.1% in the previous year. The growth for the same period last year was 5.7%. The growth stood at the lowest levels since 2008.

India’s eight core infrastructure output contracted a record low of 38.1% in Apr 2020 this is against a contraction of 9% in the previous month. The growth in the same period of the last year was 5.2%

The Nikkei Manufacturing PMI compiled by IHS Markit has increased up to 30.8 in May as compared to a record low of 27.4 in April. India’s Services Business Activity Index recorded 12.6 in May and it has increased from the record low of 5.4 in April.

The global rating agency Moody’s downgraded India’s foreign currency and local currency long term issuer ratings to Baa3 from Baa2 and maintained a negative outlook.

As per the government data released, the unemployment rate in India has improved to 5.8% from 6.1% in 2018-19. As per the recent data released by CMIE India’s unemployment rate has come down to 23.48% in May 2020 as compared to 23.52 in April 2020.

The ease of lockdown in India in the month of June can be good news for the Indian share market as the Indian economy can be back on track.

 

Stocks in the news

KEC International to speed up automation amid COVID-induced labor shortage.

Reliance on track to achieve zero net debt

Biocon Biologics starts clinical trial of a drug for severe COVID 19 complications

Uday Kotak to sell 2.83% stake in Kotak Mahindra Bank, sale to fetch over Rs 6800 Cr

HDFC offloads shares of HDFC life worth over Rs 1274 crores

Aurobindo Pharma hives off biosimilar business to a subsidiary

Bharti Infratel board to meet up on June 11 for the final call on merger with Indus Towers

Tata Power eyes distribution operations in small towns to raise the capital limit

SBI board to meet next week to decide on raising up to $1.5 billion

L&T wins contract worth up to Rs 5000 cr from Telangana govt.

Sun Pharma begins phase 2 trial of potential COVID-19 drug

 

Key factors that will impact on the Indian share market next week

 

Global Market cues

Last week the positive global market cues helped the Indian share market to close higher. The stimulus hopes from the global central banks kept bulls in charge of the Indian market. 

The relaxation in lockdown and opening up of the economy worldwide has made the market sentiment positive. The global market traded positively amid the tension between the US and China last week.If the tension between the US and China escalates next week then we may see some correction across the globe. 

Coronavirus and news

The market has ignored the increasing cases of coronavirus in India last week and closed at higher. Traders should remain cautious in this front and track the news related to Coronavirus in India as well as foreign countries.

Any positive development in Coronavirus Vaccine related news can also boost the Indian share market similarly a rise in coronavirus cases can be dampened the market sentiment

 

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Q4 Results

Britannia

The company reported its net profit increased by 26.3% as compared to last year to Rs 375 crore and its revenue rose by 2.5% on YoY to 2868 crores. The company’s operating profit grew by 3.9% to Rs 454 crore. The operating margin expanded to 15.8% from 5.6% as compared to last year.

The Q4 results of the Britannia Industry met the street’s expectations and the share price of Britannia industries reacted positively after the announcement.

BPCL

The company has posted a consolidated loss of Rs 1819 crores for the March 20 end quarter as compared to a profit of Rs 2051.4 crores in the previous quarter. The revenue from operations for the quarter stood at Rs 68997.8 crore, declining 8% as compared to Rs 74959.2 crore in December 19 end quarter.

The coronavirus outbreak globally and resultant lockdown in many countries including in India has impacted the BPCL business. The share price of BPCL has corrected immediately after the Q4 results but it recovered later.

L&T

The company reported a consolidated profit of Rs 3197 crores in the March 2020 end quarter. A 6.5% decline in profit on a YoY basis despite lower tax cost. The consolidated revenue from operations grew by 2.2% YoY to Rs 44245.28 crore in Q4FY20 impacted by coronavirus led lockdown.

The company’s consolidated profit for the full year at Rs 9549.03 crore registered a growth of 7.2% YoY and gross revenue of Rs 145452 crore for the year achieved at 8% as compared to the last year. The share price of L&T reacted positively after the announcement of Q4 results.

SBI

The bank has reported more than 4times jump in their net profit to Rs 3580.81 crores as compared to Rs 838.40 crores in the same quarter last year. The gross NPA for the March-end quarter has come down sequentially to 6.15% from 6.91% in the December end quarter and 7.53% in the last year the same period.

The total provision and contingencies for the quarter fell to Rs 13495 crores as compared to Rs 16501.89 crores in the same period last year. The Net Interest Income (NII) for the quarter fell 0.81% YoY to Rs 22767 crore from Rs 22954 crore

Overall, the SBI Q4 results beat the street estimates and the share price of SBI reacted positively after the announcement.

Next week’s Q4 results are

Q4 Results dates for Nifty50 Stocks
06 June	VEDL
08-June	Titan
09-June	Hero Motor Co
12-June	Eicher Motor
12-June	M&M
12-June	Hindalco

FIIs and DIIs data

FIIs were the buyers whereas the DIIs were the seller in the cash segment last week. The FIIs bought Rs 13927.52 crores and DIIs sold Rs 1600.01crores in the cash segment on a weekly basis. The continuous buying by the FIIs in the cash segment can further boost the market, traders need to track the FIIs buying next week.

 

Macro data for next week are

Macro Data Next Week
12-June	Foreign Exch Reserve
12-June	Inflation data
12-June	Industrial Production

Crude Oil Prices

Crude oil rose last week after the record low in the month of May. The rise in crude oil is due to the fall in the jobless rate in the U.S and the expectation on OPEC’s decision for the production output cut. 

The Brent crude futures gained 19.2% last week and at $42.30 a barrel whereas the WTI crude future was up 10.7% last week and settled at $39.55 a barrel. The crude production output cut will increase the crude oil price further. This can trigger a global market rally but as India is the second-largest crude importer this can impact Indian economy.

Traders need to track the crude oil-related news and closely follow the prices.

 

Technical Levels of Nifty50 and Bank Nifty in futures

Nifty50 technical analysis in Futures

Primary Trend of Nifty50 Futures next week: Positive

Range-Bound Trend of Nifty50 Futures: All up Moves Initiates Profit Booking (Sale) @ 10350 whereas All Down Moves Initiates Short Covering (Buy) @ 10020

If Nifty50 futures share price Moves Above 10228 and sustain. Then you should Buy with 1st Target of 10252 during the day or week with a Stop Loss of 10130 FOR the Target of 10252- 10280- 10350- 10450

If Nifty50 futures share price Moves Below 10130 and sustain. Then you should Sell with 1st Target of 10090 during the day or week with a Stop Loss of 9185. FOR the Target of 10090- 10020- 9970- 9930

 

Technical analysis of Bank Nifty share price in Futures

Primary Trend of Bank Nifty future for next week: Positive

Range-Bound Trend of Bank Nifty Future: All up Moves Initiates Profit Booking (Sale) @ 22100, whereas All Down Moves Initiates Short  Covering (Buy) @ 20650

Bank Nifty share price future Moves Above 21255 and sustain. Then you should Buy with the 1st Target of 21440 during the day with a Stop Loss of  20920. FOR the Target of 21440 – 21590- 21730- 22120

If Bank Nifty share price future Moves Below 20920 and sustained. Then you should Sell with the 1st Target of 20775 during the day with a Stop Loss of 21255. FOR the Target of 20775 – 20650- 20380-20115

 

Conclusions.

Last week’s rally in the share market was due to positive global market cues and on the hopes that the Indian economy will be back on track after easing the lockdown. The market completely ignored the negative news and was trading higher, the Q4 results have also added some fuel in the rally.

Next week the Indian share market will continue its upward journey but traders should closely track the above key factors that may impact the market. Traders can also follow our Nifty50 and Bank Nifty technical levels on a daily basis.

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