Weekly Market Recap: Nifty's Recovery and Strategic Insights for Next Week

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Markets bounced back last week, snapping a two-week losing streak. Here's our take on this week gone by, some stories you might have missed out on, and our thoughts on what to do going ahead, in your weekly report.

WEEKLY RECAP

Staging A Comeback?

  • Indices showed signs of rebound, particularly on Friday, with the Nifty climbing 0.7% in the truncated trading week.  
  • A shift in global sentiment from panic to optimism spurred this recovery, and volatility expectations also declined noticeably as the week progressed.

The Driving Forces

  • Talk of the Fed and other major central banks pulling off the much-vaunted soft landing returned to the headlines last week.
  • With US inflation nearing the Fed’s 2% target, expectations are growing among investors and Fed officials for rate cuts starting next month.
  • The three major Wall Street indices recorded their biggest weekly percentage gains since late October, with the S&P 500 and Nasdaq posting their first weekly gains in five.

The Winners

  • Needless to say, with the optimism around the US economy, IT was the week’s top winner on the Nifty by quite a margin, with both top gainers being IT giants.
  • Tech Mahindra and Wipro both gained over 5% over the week, with the former hitting new 52-week highs, in tandem with the gains on the NASDAQ.

The Losers

  • Divi’s Labs was the top loser on the Nifty, shedding 4.1% as analysts highlighted substantial downside risks from a generic version of its leading drug. 
  • Coal India, along with several other mining companies, also faced headwinds, due to a Supreme Court verdict allowing states to collect past dues on royalties. Read more: Supreme Court Verdict Shakes Up Mining Sector

Meanwhile…

  • The UK economy offered a moment of respite as it recorded a 0.6% GDP growth in the June quarter, positioning it as the fastest-growing G7 economy for the first half of the year.
  • In India, wholesale inflation cooled to 2.04% in July, alongside a drop in retail inflation, though industrial production growth slowed to 4.2% in June, month-on-month.
  • July witnessed an unprecedented surge in investments through Systematic Investment Plans (SIPs), pushing the total assets under management (AUM) to a record high of Rs 65 lakh crore. Check how your Mutual Funds are performing.

Market Brief

Key Indices
Sectors
Stocks
Other Key Data

Market Outlook

Market Outlook
Sectors to Watch
Stocks in Radar: Mphasis, HCL Technologies, Tata Motors, Bajaj Auto, CDSL

Our Take

  • Buffeted by an apparent return to optimism in global markets, investors on D-Street may now be in a reasonable place to buy the past couple of weeks’ dip.
  • Consequently, we expect a bullish trend for the Nifty next week, with a projected trading range between 24,200 and 24,850.
  • As the earnings season wraps up, the focus now shifts to global market indicators. Key events to watch include next week's Fed Jackson Hole Symposium, where Fed Chair Jerome Powell might hint at an upcoming Fed rate cut. Domestically, institutional flows and forthcoming economic data will also play critical roles in shaping market trends.

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