Stock market: Key Nifty levels, sectors and other factors to watch week
Global cues and inflation data would be the major driving factors for Indian equity markets this week, analysts said. Sensex and Nifty rose about 0.3% last week, though the overall market sentiment remains positive, they say, adding that higher valuations could however trigger bouts of profit booking.
Markets would also be guided by rupee-dollar trend, Brent crude and Foreign institutional investors (FIIs) movement.
"The trend continues to remain bullish and traders are advised to initiate long positions only around dips to minimize the risk of being capitalized at extreme levels, Samco Securities said.
Santosh Meena, head of research at Swastika Investmart, says, "If we talk about derivative data then FIIs' long exposure in the index future stands at 63% while PCR is sitting at 1.45 level and both are looking in a comfortable zone."
"Among the sectors, the chart of the Nifty PSE index is looking strong means PSU stocks may outperform from here and ONGC, OIL India, and Gail are looking interesting amid bullish momentum in global natural gas prices. Other than the PSU sector, metal stocks may also catch up momentum as global markets are benign whereas metal prices are seeing a rise due to cool off in the dollar index where Hindalco may continue to outperform due to strength in aluminium prices," he added.
The inflation data for August will be a key data point that the market awaits in the coming week, according to Vinod Nair, Head of Research at Geojit Financial Services.
"Retail inflation is expected to remain high in line with the July inflation rate of 5.59% while wholesale inflation is expected to ease from the previous level of 11.16%. Globally, the investors are awaiting the outcome of ECB meeting to gauge future tapering plans," he said.
Talking about key levels to watch, 17246-17437 is the band for the Nifty, a move beyond which could accelerate the trend in that direction, says Deepak Jasani, Head of Retail Research, HDFC Securities. (With Agency Inputs)