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Monthly Market Roundup Market Outlook: June
The month of May took GST implementation, Going ahead, the Indian economy will strengthen
markets on ride with power and banking sector as the government pushing through several key
bulls partying on Dalal reforms have also been reforms such as liberalisation of FDI rules in key
Street celebrating the seen as big drivers of the sectors, July rollout of the Goods & Service Tax
third anniversary of economy. (GST) and a national bankruptcy code which will
Modi government. Modi The month finally ended improve growth in long term. Further, expectations
fever has spread on both with upward bias as S&P of good monsoon, banking sector reforms, RBI
domestic and international BSE Sensex delivered monetary policy which will be scheduled on 7th
fronts. With major positive returns of 4.10% Jun, 2017 are the major factors which will be keenly
initiatives such as Make to settle at 31145.80 and watched by investors. On the global front, the US
in India, Housing for All, Nifty50 gained 3.41% FOMC meeting, European Central Bank (ECB)
Swachh Bharat Abhiyan, ending the month at monetary policy, Japanese monetary policy and BoE
Jan-Dhan Yojana, Surgical 9621.25. Monetary Policy will be keenly watched by market
Strike and Demonetisation, On the institutional side, participants. Hence, we recommend investors to
the government has foreign institutional invest in good companies with long term horizon.
managed to do major investors (FIIs) bought
tasks in a short span of Rs 7,711.41 crore worth of Nifty Technical Outlook: June
time. Immediate factors equities during the month
responsible for pushing the while domestic mutual Nifty
benchmark indices to new fund houses continued
highs include hopes of an their buying spree with net
above average monsoon, purchases of Rs 9,977.64
expectations of a rebound crore in May 2017.
in earnings growth of
corporate, the impending
Economic Data Wrap Up – May
¡ India's Apr Nikkei ¡ India’s Apr WPI On the monthly chart, we are observing a bull
manufacturing PMI inflation fell to 3.85% candle which clearly reflects that momentum on
unchanged at 52.5. from 5.29% in Mar. the upside is likely to continue. In the coming
month if Nifty trades and closes above 9696 level
¡ India’s Apr Nikkei ¡ India’s Apr trade deficit then it is likely to test 9807 – 9918 – 10047 levels.
Services PMI fell to 50.2 rose to $13.25 bln from However, if Nifty trades and closes below 9545
from 51.5 in Mar. $4.84 bln YoY. level then it can test 9435 – 9324 – 9195 levels.
¡ India’s Mar IIP growth ¡ India’s Apr core sector Broadly, we are of the opinion that as long
rose to 2.7% from 1.9% growth fell to 2.5% from as Nifty holds 9435 there is high probability
in Feb. 5.3% in Mar. that Nifty may test the 9800 – 9900 in couple of
months.
¡ India’s Apr CPI ¡ India’s Jan-Mar GDP
inflation fell to 2.99% growth at 6.1% from 7%
from 3.81% in Mar. QoQ.
3 ARIHANT CAPITAL ¡ JUNE 2017