With the poll results out for the five states, the market is expected to continue its upward march on the back of the strong mandate that the BJP has got in the politically crucial and sensitive state of Uttar Pradesh. The poll results were being keenly watched as a strong vote for the BJP is expected to give fillip to the ongoing policy reforms.
“The stock market will surely rejoice on Tuesday with a possible 150 points rally on the Nifty. This firmly puts the central government’s focus back on the reform path, which will enthuse market,” said Amar Ambani, Head of Research, IIFL.
This assumes significance as the GST Council is scheduled to meet on March 16. The last meet held on March 5 gave in-principle approval to two key draft laws.
This week would also see the listing of Music Broadcast, the company that runs Radio City. The company saw a huge interest from investors that led to the public issue getting subscribed close to 40 times. The segment reserved for high networth individuals was subscribed 110 times while that for institutional investors was subscribed 40 times.
While the shares of Avenue Supermarts, which manages the D Mart chain of supermarkets, will be listed on March 21, the week could see investor interest in shares of retail chains and even FMCG companies that see a large chunk of their sales through such modern retail stores.
The initial public offer of Avenue Supermarts was subscribed close to 105 times.
While the equity markets have been volatile in the recent past, the benchmark 30-share Sensex gained about 115 points last week. The coming week would be a truncated one as the markets would be shut on Monday on account of Holi.
Eye on U.S. rates
The week would also see the U.S. Federal Reserve meeting on this week to decide on increasing interest rates. Interestingly, mortgage rates in U.S., especially those for 30-year home loans, have already risen to their highest level this year ahead of the Fed meeting.
Rakesh Tarway, Head of Research, Reliance Securities said that the open interest data confirms that the market is in for a bigger move in the coming week and the Fed meeting would also provide some direction to the markets.
The markets also stand to gain from the bullish stance of overseas investors that have turned net buyers in the equity market. Incidentally, the Fed decision could also impact foreign liquidity in all emerging markets, including India.
Data shows that foreign portfolio investors (FPIs) have been net buyers at ₹9,629 crore in March after pumping in ₹9,902 crore in February. Meanwhile, domestic institutional investors (DIIs), that include banks and insurance companies, sold shares worth more than ₹4,000 crore in the previous week.
Even the technical analysts are expecting an upward rally in the week if the benchmark indices are able to hold on to crucial levels.
“Nifty has been consolidating in the 8,860 to 9,000 zone in the last thirteen trading sessions and is awaiting a decisive range breakout to commence the next leg of rally,” said Chandan Taparia, Derivatives & Technical Analyst, Motilal Oswal Securities. “Now, a hold above 9,000 could start a fresh up move towards 9,119 and then 9,250 while on the downside, multiple supports are seen at the 8,860 level.”
Published - March 12, 2017 09:47 pm IST
