The benchmark indices braved the Brexit storm by falling just one per cent for the week ended June 24. The S&P BSE Sensex slipped 0.9 per cent while the Nifty50 plunged 1 per cent for the week.
The Nifty50 index had broken its consolidation band between 8,065 and 8,300 levels on the lower side and slipped towards the 7,927 mark on Friday, but managed to bounce back above 8,050 towards closing, which shows that value buying emerged at lower levels.
With a key event risk getting over, how is the coming week going to pan out for the market? ETMarkets.com collated list of top five events that investors should watch out for in the coming week.
‘Brexit’ impact to linger on: Brexit was one event that nobody wished for. But now that it has materialised, global financial markets have to deal with the uncertainty for some more time before things stabilise.
The major impact of Brexit will be felt on currencies across the globe and foreign capital flows which might flow out in the short term, putting pressure on equity markets. FIIs pulled out over Rs 600 crore from the Indian equity market for the week ended June 24.
“With risk rising in the global financial market foreign capital will flow out putting pressure on the rupee to depreciate and making Indian financial market volatile,” said Sunil Kumar Sinha, Principal Economist, India Ra ..
“A number of Indian companies having exposure to Europe/UK either through trade or in case their production units are located there would be adversely impacted,” he said.
F&O expiry: The domestic market is likely to remain volatile ahead of expiry of June series derivative contracts due on Thursday, June 30, as traders roll over positions in the derivative segment from the near-month series to July series.
“We will see major volatility in the Indian market due to the expiry of equity and currency future contracts. Major open interest is lying in Nifty 8,000 put of 65 lakh contracts and in Nifty 8,400 call of 55 lakh contracts,” Nirdosh Gaur, MD & CEO of Discount Broking Firm, Moneypalm, said in a note.
“The market will remain in this range till expiry and 7950 will act as major support and 8120 and 8180 will act as major resistance for markets in this week,” he said.
Manufacturing and services PMI: Markit Economics will announce manufacturing PMI for June on Friday and services PMI on Tuesday. The Nikkei Manufacturing Purchasing Managers’ Index (PMI), compiled by Markit, rose to 50.7 in May from 50.5 in April. A reading above 50 indicates expansion.
Nifty50 technical factors: The Nifty50 recouped losses on Friday, but fell about 1 per cent for the week ended June 24. The Nifty50 made a ‘Doji’ candle on the weekly chart which means indecisiveness among bulls and the bears. “A ‘Doji’ candle means that bulls and bears are both fighting in the market to get their grip and closing the market without any decisive consideration,” Chandan Taparia, Derivatives Analyst – Equity Research, Anand Rathi Financial Services,
“We have to remember that a Doji candle after a strong rally some time may cause a trend reversal but the market is ruling out that possibility as the index has been making higher top – higher bottom formation,”
The index has to hold above 7,960-7,980 zones to witness a range bound move while on upside holding above 8,150 may open a scope for texting next hurdle at 8,242 level.
Investment & trading in securities market is always subjected to market risks, past performance is not a guarantee of future performance.
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