Page 3 - 1700710_Value_Plus_June

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