Nifty Outlook for the week 29th MAY to 2nd JUNE

NIFTY

Title: Nifty Extends Gains as Indian Equity Markets Show Resilience

Introduction:

The Indian equity markets exhibited resilience and closed the week on a positive note, marking a second consecutive session of gains. Supported by favorable global cues, the domestic markets experienced an upward movement on Friday. This article provides an overview of the market's performance, sectoral trends, Nifty futures, institutional investor activity, and the outlook for the Nifty index.

 

Positive Market Sentiment and Sectoral Performance:

Throughout the trading session, the benchmark indices steadily climbed higher, driven primarily by buying activities in heavyweight stock Reliance Industries. This positive sentiment spread across various sectors, resulting in all sectoral indices on the NSE closing in the green. Notably, the Media, IT, and FMCG sectors emerged as the top performers, contributing to the overall upward movement of the market.

 

Midcap and Small Cap Indices:

The positive market breadth was evident as both the Nifty midcap and small cap indices recorded gains. The Nifty midcap index saw an increase of 0.81 percent, while the small cap index rose by 0.53 percent. This indicates a broad-based positive sentiment, with smaller companies also participating in the market rally.

 

Nifty Futures and Momentum:

Taking a closer look at the Nifty futures for the June series on Friday, May 26, they opened with a positive gap of 20.1 points from the previous close. The Nifty futures displayed intraday volatility, reaching an intraday high of 18,590 and a low of 18,419. By the end of the trading session, the Nifty futures posted a significant movement of 171 points, closing at 18,570.20, representing a gain of 0.81 percent. This positive momentum in the futures market indicates a favorable outlook for the Nifty index.

 

Anticipation of GDP Figures:

Market participants eagerly anticipate the release of India's Gross Domestic Product (GDP) figures for the last quarter of FY 2022-23. Despite global challenges, experts anticipate a growth rate of 5.5% for the Indian economy during this period. Positive GDP figures would demonstrate the resilience of the Indian economy, instilling confidence among investors.

 

Institutional Investor Activity:

Foreign Institutional Investors (FIIs) continued their buying spree, while Domestic Institutional Investors (DIIs) turned into net buyers in the Indian equity markets throughout the previous week. FIIs purchased shares worth Rs 3,230.49 crore, while DIIs bought shares worth Rs 3,482.21 crore. This substantial institutional buying activity enhances market liquidity and boosts confidence among domestic retail investors.

 

Outlook for the Nifty Index:

Considering the current market conditions, with most frontline stocks well positioned and indicating a positive bias, the Nifty index has potential near-term upside targets of 18,800-18,900 levels. These levels serve as significant milestones for traders and investors. Furthermore, the index is expected to trade within a range of 18,100-18,900 levels in the coming week, suggesting a positive market sentiment and a favorable trading environment for market participants.

 

Conclusion:

The Indian equity markets displayed resilience and closed the week on a positive note, benefiting from favorable global cues. The upward movement was supported by buying activities across sectors, with the Media, IT, and FMCG sectors emerging as the top performers. Nifty futures exhibited positive momentum, while institutional investor activity remained robust. As market participants await GDP figures, the overall outlook for the Nifty index appears positive, with potential upside targets in the near term. Investors should stay informed and monitor market developments to make well-informed investment decisions.