After touching a fresh 17 month high on the last day of the Samvat 2065, markets started the first week of the new Samvat on a weak note. Sensex and Nifty lost nearly 3% over the week, underperforming most of the global markets. BSE Oil & Gas index fell 6.4% during the week, followed by the Capital Goods index, which lost 5.7%. Among stocks, Index heavyweight Reliance plunged 8%, as its partner in KG Basin-Hardy Oil said a D9 well will be plugged and abandoned. JP Associate and L & T lost 8.6% and 7.1% as their quarterly results were below market expectations. The bright spot was the IT index, which gained 3.2% week-on-week as TCS came out with good set of numbers in last weekend and Rupee, after six weeks of appreciation, depreciated 22 paisa against the dollar in the week gone by. FMCG index gained 1.5% on weekly basis as ITC came out with strong set of numbers and finished the week 3.7% higher.
As we enter the new week, market is bracing for couple of key events. Reserve Bank of India will announce its midyear credit policy on Friday, 23rd October. While key rates are likely to be kept unchanged, market will keenly wait for any signal by the Apex bank on exit from the loose monetary policy. Next week will also see the expiry of October derivative series. We are entering the expiry week with an Open interest of Rs. 112000 cr. Call writing at 5000 and 5100 strikes and selling in index futures by FIIs to the tune of Rs. 1900 cr. are negative signals from the derivatives going into the fresh week. On technical charts too indices look vulnerable and violation of 16600 is likely to result in a sharp fall. Next week will also see the last bunch of quarterly results including ONGC, ICICI Bank, Tata Motors, DLF, Tata Steel, Wipro and Ambuja Cements among others.
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