Sensex, Nifty week ahead: This week’s important events include FX reserves data, FII investments, the Global Services PMI, and the FOMC minutes.
SUMMARY
- FOMC minutes and Initial Jobless Claims are important market events in the United States on November 22, followed by S&P Global Manufacturing PMI and S&P Global Services PMI on November 24.
- According to a market expert, FPIs sold stocks worth Rs 83,422 crores through exchanges between August and mid-November.
- During this time, DIIs alone purchased stocks worth Rs 77,995 crore.
For the third week in a row, Indian equities markets closed in the green, with statistics showing that retail inflation based on the Consumer Price Index (CPI) fell for the second consecutive month to a four-month low of 4.87 percent in October 2023, in line with dropping worldwide inflation. This week, significant events such as Foreign Exchange Reserves data, FII investments, the Global Services PMI, and the FOMC minutes in the US will keep markets buzzing.
Economic data
On the economic front, investors will be looking for additional clues from the foreign exchange reserves data, which will be released on November 24. On November 3, India’s foreign exchange reserves grew to $590.78 billion, up from $586.11 billion the previous week. Meanwhile, investors will be watching the trend in investment by foreign institutional investors as well as the movement of the rupee versus the dollar.
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US market data
On the global front, investors will be watching key economic data from the United States (US), beginning with the Chicago Fed National Activity Index, Redbook on November 21, FOMC Minutes, Initial Jobless Claims, and Michigan Consumer Sentiment on November 22, S&P Global Composite PMI, S&P Global Manufacturing PMI, and S&P Global Services PMI on November 24.
Foreign investments
“An important trend in the market is the increasing clout of DIIs, HNIs, and retail investors and the diminishing influence of FPIs,” said V. K. Vijayakumar, Chief Investment Strategist at Geojit Financial Services. FPIs sold stocks worth Rs 83,422 crore through exchanges in August, September, October, and November up to November 15th. DIIs alone purchased stocks worth Rs 77,995 crore during this time period. FPI selling is totally offset by DII and individual investor purchases. This is why the Nifty is hovering around 19700, where it was in early August.”
He also stated that the market’s tenacity and big upmoves on favorable days have necessitated a reassessment of FPI strategy. That is why, following sustained selling in the first two weeks of November, they became purchasers on the 15th and 16th of this month. “The sharp drop in the US 10-year bond yield to 4.45% has proven to be an inflection point for the mother market, and thus for global stock markets.” Markets currently expect that the Fed has finished raising interest rates and will gradually begin pricing rate reduction in 2024. If the US inflation trajectory continues, the Fed may lower rates by mid-2024. This can help FPI inflows into emerging markets like India,” Vijayakumar added.
Global market trends
“The RBI’s action to raise risk weights for unsecured loans dampened banking and NBFC stocks, while insurance and AMC stocks benefited from rotational buying within the BFSI sector,” said Deepak Jasani, Head of Retail Research at HDFC Securities. On Friday, Asian markets fell largely as investor sentiment cooled after recent gains fueled by hopes that US interest rates had peaked. European stocks began to rise as investors increased their bets on interest-rate cuts next year in response to new signals of an economic downturn.
Technical Prospects
On November 17, the Nifty closed lower after fluctuating between gains and losses. The Nifty closed at 19.731.8, down 0.17 percent, or 33.4 points. The NSE’s volume increased to near-term highs. Broad market indices ended marginally higher even as the advance-decline ratio, while positive at 1.16:1, fell from the previous day. “The Nifty formed two back-to-back candles with deep top shadows. This indicates that there is selling pressure on hikes. As a result, the Nifty may struggle to move and stay above 19850 in the near term, while the 1946–19547 area may provide support,” Jasani said.
Bank Nifty
According to Kunal Shah, Senior Technical Analyst at LKP Securities, the Bank Nifty began with a gap down and has remained below the 44,000 line since the RBI announced tighter provisions for consumer loans. The next level of support for the index is located between 43,300 and 43,250, which serves as an important line of defense for the bulls. “If this level holds, it could pave the way for a possible recovery to 44,000.”A breach of the stated support, on the other hand, may enhance selling pressure, bringing the index lower towards the 42,700 mark on the downside,” Shah warned.
Frequently asked questions
What is next week Nifty prediction?
Nifty Prediction for Next Week (20th to 24th November 2023)
| Bank Nifty View | Levels |
|---|---|
| Support | 19500-19400 |
| Resistance | 19900-20000 |
| Bias | Sideways to Bullish |
Will market correct in 2023?
Analysts predict that markets will stay bullish in the second half of 2023. Axis Securities has predicted that the Nifty will reach 20,200 by December 2023. According to economists, this strength is supported by a number of macroeconomic reasons.
What is the Sensex meaning?
SENSEX stands for Stock Exchange Sensitive Index. The SENSEX, commonly known as the BSE (Bombay Stock Exchange), is India’s oldest stock exchange. It is a free-floating, economy-weighted index comprising 30 financially strong and well-established BSE-listed companies.
What do the minutes of the FOMC meeting mean?
The Federal Open Market Committee (FOMC) minutes are a complete record of the FOMC meetings that are released three weeks after each meeting. The minutes provide more detailed insights into the monetary policy opinions of all committee members, as well as how individual members see the value of the USD and other instruments.
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