Weekly Stock Market Analysis: Record Highs and Investment Opportunities

Markets advanced for the third straight week, closing at all-time highs and posting the largest weekly gain in two months. 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

Keeping the momentum going

• The markets sustained their upward trajectory, climbing a robust 1.66% by the end of the week to close at record high levels. 
• The broader indices also hit new all-time highs during the week, although they underperformed compared to benchmark indices. The BSE Midcap, Largecap, and Smallcap indices advanced 1.5%, 1.3%, and 0.6% respectively.

The driving forces

• The predominant global narrative centered around the Federal Reserve's plans to cut interest rates in September, which colored global markets rather green.
• Movements at home thus largely mirrored those of the Dow Jones Industrial Average (which also hit record closing highs) and the Nikkei.

The winners

• Amid a wave of optimistic updates from the U.S. economy last week, the IT sector emerged brightly, with the top-gainer stock (LTIMindtree) and sector both being IT.
• Bajaj Finserv also stood out as a notable achiever on D-Street, jumping 8.7% amid buzz about Bajaj Housing's upcoming IPO slated for early September.

The losers

• Coal India fell 2.6% last week amid worries about sales volume growth, which, according to brokerage firm Nuvama, might not meet management’s expectations. 
• Kotak Mahindra Bank also slipped over 2% following reports that Sumitomo Mitsui intended to sell half of its stake in the bank for $300 million.

Meanwhile…

• US macro data revealed that the Federal Reserve’s preferred gauge of inflation remained constant at 2.5% in July, with the economy expanding by a strong 3% in the second quarter. 
• At home, GDP growth slowed to a 15-month low of 6.7% during the April-June quarter, down from 7.8% in the previous quarter.
• Last week also saw the launch of three mainboard IPOs in the primary market. For a detailed analysis of these IPOs, visit: IPO Corner | Liquide

Market Brief

Market Outlook

Our take

• Following a stellar run to record closing highs last week, markets might soon assess valuations and domestic GDP data, potentially leading to a period of consolidation next week. 
• Consequently, we predict that the Nifty will trade within a range of 24,900 to 25,500 in the upcoming week.

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